No interest rate change likely if inflation stays stable
The Reserve Bank of India (RBI) is unlikely to revise rates before April, if inflation remains around 8.5 per cent. The central bank has already factored this in its inflation projection for March and is not likely to take any mid-term action, unless there is an unseen event, said the RBI Deputy Governor, Dr Subir Gokran. Fitch reaffirms India at BBB negative Fitch Ratings has affirmed India's sovereign ratings at ‘BBB-'. The outlook for the long-term local currency issuer default rating (IDR) continues to be negative. Fitch regards the deterioration in India's public finances since 2008 as partly structural, putting negative pressure on the local currency rating that will require substantive fiscal reform to redress. India may grow at 7.5 per cent in 2010-11: World Bank The World Bank said that Indian economy is expected to grow at 7.5-8 per cent in 2010-11 and 2011-12 respectively. This is well above the 6.4 per cent average recorded during 1995-2005, it said in the its report on "Global Economic Prospects 2010". The report said that said that India's growth prospects will remain strong, even as world economy recovers slowly.
Indian Financial Institutions
TMB posts marginal rise in Q3 net profit
The unaudited financial results of Tamilnad Mercantile Bank (TMB), for the nine months ended December 31, 2009, showed a marginal increase in the net profit of Rs 119.42 crore from Rs 113.52 crore on year-on-year basis. During the period, the total business of the bank increased 21.63 per cent to Rs 17,839.41 crore (Rs 14,665.91 crore) and the total income went up by 13.49 per cent at Rs 916.03 crore (Rs 807.15 crore).
Products & Alliances
Aditya Birla Financial ties up with Woori Investments
Aditya Birla Financial Services Group (ABFSG) has signed an MoU with South Korea-based Woori Investment & Securities that will help the Indian company raise funds from South Korea. ABFSG will look to raise around $500 million from South Korea for its mutual funds, real estate funds, and PE funds. The move will help both the groups leverage business synergies and extend their product, service and advice offerings to a larger customer base.
International news
Fiscal sustainability needs attention: IMF
With many countries piling up massive debts in the wake of the global crisis, the International Monetary Fund (IMF) has cautioned that "fiscal sustainability" is going to be a big problem for the coming several years. To tackle the raging financial turmoil, many developed and developing nations came up with huge stimulus measures to bolster their respective economies.
Market Updates
Sensex ends 192 points down
The Bombay Stock Exchange benchmark Sensex ended the session on Tuesday with a fall of 192.59 points at 16,163.44 driven by heavy profit-booking. The wide-based National Stock Exchange index Nifty was down 69.6 points at 4,830.10. The Sensex failed to sustain its morning uptrend in the afternoon session on heavy selling by funds and retail investors. New currency pairs clock Rs 3,998 crore turnover Combined trading volume of currency futures trading in three new currency pairs EURO /INR, GBP / INR and JPY / INR, introduced by NSE and MCX Stock Exchange clocked approximately Rs 3,997.83 crore in turnover on the inaugural day. The daily volume traded in the entire currency derivatives segment was approximately Rs 28,546 crore.
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NCAER revises GDP growth upwards to 7 per cent
National Council for Applied Economic Research (NCAER) has pegged the country's economic growth for the current fiscal at 7 per cent, a notch above its earlier forecast of 6.9 per cent but still lower than the expectations of the Reserve Bank of India (RBI) and the government. "The overall GDP growth for the year is pegged at 7 per cent, somewhat above our previous forecast of 6.9 per cent provided in October 2009," the NCAER said in its quarterly review of the economy. GDP data will give true picture on stimulus Economic growth numbers for the current fiscal, to be released by May, will provide an actual picture to the Government to decide if stimulus packages could be rolled back, the Chief Statistician, Mr Pronab Sen, said. However, strong industrial growth numbers do indicate that the Government may start thinking of withdrawing these measures, he added. Co-operative banking can bring financial inclusion The future of the urban co-operative banks lies in penetrating the unbanked people in urban areas, said the Deputy Governor of the Reserve Bank of India, Dr K.C. Chakrabarty, at the flag-off ceremony of centralised core-banking solution for urban co-operative banks in Karnataka. “This will be the clientele that commercial banks may not be able to touch because they are big," he added.
Indian Financial Institutions
SBI waives off issue charges on gift cards
State Bank of India (SBI) has waived issue charges on its gift cards up to March 31. The initiative was part of a special promotion offer and the cards could also be personlised for bulk issue to the corporates. Generally, the charges on gift cards range from Rs 50 to Rs 200 a card across banks. Axis Bank to beef up wealth management business Axis Bank, plans to ramp up its fledgling wealth management and private banking businesses and nearly triple the number of relationship managers over the next 12 months. The lender has 15 relationship managers for private banking and 70 for wealth management, which is aimed at customers with a net worth of at least $100,000.
International news
ADB issues $2.5 billion bonds in US market
The Asian Development Bank (ADB) has issued $2.5 billion-bonds in the US market to boost its capital resources. The bond sale is part of the agency's plan to raise $15 billion in 2010. The proceeds from the $2.5 billion five-year bond issue would help in bolstering the bank's ordinary capital resources and would be used for non-concessional operations.
Spotlight
Fiscal health of major economies is matter of concern
The near zero interest rates and large fiscal deficits in the major economies of the world are creating waves of anxiety among economists, not to speak of policymakers themselves. They must surely cease some time, but it's not clear when. Compared to the Western economies and Japan, China and India had it easy. Their central banks had their work cut out for them.
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3.2.2010
Currency
Rate (Rs.)
Change
USD
46.04
0.21
Euro
64.33
0.06
GBP
73.79
-0.02
Yen (100)
50.88
0.08
3.2.2010 .00
Index
Change
NIFTY
4931.85
101.75
SENSEX
16496.05
332.61
Market Updates
Sensex ends 332 points up
The Bombay Stock Exchange benchmark Sensex ended the session on Wednesday with a gain of 332.61 points at 16,496.05 driven by fund-buying in heavyweights. The wide—based National Stock Exchange index Nifty ended up by 101.75 points at 4,931.85. Firm trend in Asian stock and commodity markets drove the buying in the domestic markets.
