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Mumbai (Maharashtra) [India], August 18 (ANI): <keyword id="6354335" type="General" weightage="100" keywordseo="reserve-bank-of-india" source="Orion">Reserve Bank of India</keyword> on Friday said regulated entities (REs) have the freedom and they must offer all categories of retail loans either on a fixed or <keyword id="1104583" type="General" weightage="20" keywordseo="floating-interest-rates" source="Orion">floating interest rates</keyword> basis. At the time of sanction of EMI-based floating rate personal loans, RBI said regulated entities are required to take into account the repayment capacity of borrowers to ensure that adequate headroom or margin is available for elongation of tenor and or increase in EMI, in the scenario of a possible increase in the external benchmark rate during the tenor of the loan. In the wake of rising <keyword id="6371181" type="General" weightage="20" keywordseo="interest-rates" source="Orion">interest rates</keyword>, RBI said it had received several grievances from consumers related to the elongation of loan tenor and or increase in EMI amount, without proper communication with and or consent of the borrowers. "In order to address these concerns, the REs are advised to put in place an appropriate policy framework meeting the following requirements for implementation and compliance," RBI said. As a part of the new rules, the central bank said: At the time of sanction, regulated entities shall clearly communicate to the borrowers about the possible impact of change in benchmark interest rate on the loan leading to changes in EMI and/or tenor or both. Subsequently, any increase in the EMI or tenor or both on account of the above shall be communicated to the borrower immediately through appropriate channels.At the time of reset of interest rates, regulated entities shall provide the option to the borrowers to switch over to a fixed rate as per their Board approved policy. The policy, inter alia, may also specify the number of times a borrower will be allowed to switch during the tenor of the loan. The borrowers shall also be given the choice to opt for enhancement in EMI or elongation of tenor or for a combination of both options; and, to prepay, either in part or in full, at any point during the tenor of the loan. All applicable charges for switching of loans from floating to fixed rate and any other service charges/ administrative costs incidental to the exercise of the above options shall be transparently disclosed in the sanction letter and also at the time of revision of such charges/ costs by the regulated entities from time to time. REs shall ensure that the elongation of tenor in case of floating rate loan does not result in negative amortisation. RBI said regulated entities shall ensure that these instructions are extended to the existing as well as new loans suitably by December 31, 2023. All existing borrowers shall be sent a communication, through appropriate channels, intimating the options available to them, RBI said. (ANI)

Banks must allow retail borrowers to switch between fixed and floating rates: RBI

Mumbai, Jun 2 () The country's largest lender <keyword id="6354731" type="UNKNOWN" weightage="20" keywordseo="state-bank-of-india">State Bank of India</keyword> (SBI) has reduced interest rate on savings bank deposits by 5 basis points to 2.70% per annum across all brackets. The revised interest rate is applicable from May 31, 2020, the bank's website showed. For savings bank deposits, the bank has two slabs -- balance up to Rs 1 lakh and those with above Rs 1 lakh balance. In April, the bank had reduced its savings bank deposits rate by 25 basis points to 2.75% per annum across all slabs. The lender, from May 27, has also slashed its retail term deposit rates by up to 40 basis points (bps) across all tenors. It was the second reduction in fixed deposits (FD) rates by the lender in May. For deposits maturing in seven days to 45 days, the lender is offering an interest rate of 2.90% as against 3.30% earlier, according to the SBI website. It has revised the rate for FDs in 180 days to 210 days bracket to 4.40% compared from 4.80% earlier. The interest rate on deposits maturing in 5 years to 10 years has been cut to 5.40% from 5.70% earlier. The bank has also cut interest rates for bulk deposits (Rs 2 crore and above) by up to 50 basis points. HV RVK

SBI Bank FD interest rates reduced again - check the latest rates

<ul><li>After a rate cut in February, the mandate of the central bank was clear: it wants to boost lending and thereby stimulate economic growth. </li><li>However, the country’s commercial lenders have been slow to pass on the rate cut to consumers. </li><li>As a result, the governor of the Reserve Bank of India, <keyword id="6359111" type="UNKNOWN" weightage="20" keywordseo="Shaktikanta-Das">Shaktikanta Das</keyword>, met with the CEO’s of the country banks to do so. The banks complained that they didn’t have much room to cut rates but said they would try their best. </li></ul>After <a href="https://www.businessinsider.in/rbi-policy-update-cuts-interest-rate-citing-low-inflation-and-it-may-boost-growth/articleshow/67880230.cms">a rate cut </a>in February, the mandate of the central bank was clear: it wants to boost lending and thereby stimulate economic growth as the country heads into national elections. And now it wants Indian banks to follow suit. However, the country’s commercial lenders have been slow to pass on the rate cut to consumers in the form of cheaper small business loans, home loans and car loans. As a result, the governor of the Reserve Bank of India, Shaktikanta Das, met with the CEO’s of the country banks - such as Punjab National Bank, ICICI Bank, Kotak Bank, Bank of Baroda etc - yesterday to exhort them <a href="https://www.business-standard.com/article/finance/rbi-governor-das-asks-bankers-to-pass-on-rate-cut-benefits-to-consumers-119022101292_1.html">to cut lending rates</a> for customers so as to encourage consumer confidence and investment. While the banks’ response was mostly non-committal, they said they would <a href="https://www.thehindu.com/business/will-try-to-pass-on-rate-cut-banks/article26333312.ece">try their best to cut rates</a> on home loans and personal loans. They have complained in the past of their high borrowing costs and shrinking margins - both of which are a consequence of their stock of bad loans. They also pointed to a lack of liquidity in the banking system, as consumers are hoarding cash ahead of elections. After the rate cut decision, wherein the base lending rate was cut by 25 basis points to 6.25%, the State Bank of India only cut home loan rates by <a href="https://economictimes.indiatimes.com/markets/stocks/news/sbi-cuts-interest-rate-on-home-loan-by-5-bps/articleshow/67910450.cms">a mere 5 basis points</a>. The only other bank to do the same was Bank of Maharashtra - by the same measly amount. Earlier this week, the chairman of State Bank of India, Rajnish Kumar, said that banks did not <a href="https://economictimes.indiatimes.com/industry/banking/finance/banking/headroom-to-cut-rates-does-not-exist-sbi-chairman/articleshow/68044675.cms">have the room to cut lending rates</a> because it would need to cut its deposit rates first. And it couldn’t do this unless other banks did so as well, because otherwise its customers would park their money in banks with higher deposit rates. SEE ALSO: <a href="https://www.businessinsider.in/rbi-policy-update-cuts-interest-rate-citing-low-inflation-and-it-may-boost-growth/articleshow/67880230.cms">India’s central bank cuts interest rate to give growth a chance</a> <a href="https://www.businessinsider.in/rbi-pays-interim-dividend-central-government/articleshow/68057230.cms">The Modi administration’s overspending gets rewarded with an interim dividend from the central bank</a>

India’s central bank is calling on the country’s lenders to lower rates

<ul class="summary-list"><li>The <keyword id="106488" type="UNKNOWN" weightage="60" keywordseo="bank-of-england" source="Orion">Bank of England</keyword> hiked its main interest rate for the second meeting running Thursday, from 0.25% to 0.5%.</li><li><keyword id="11962842" type="UNKNOWN" weightage="60" keywordseo="central-banks" source="Orion">Central banks</keyword> around the world are grappling with red-hot inflation, which is running at a 30-year high in the UK.</li></ul>The Bank of England has hiked UK <keyword id="6371181" type="UNKNOWN" weightage="60" keywordseo="interest-rates" source="Orion">interest rates</keyword> for the second meeting in a row, as it tries to tackle the strongest inflation in 30 years.The <keyword id="6538058" type="UNKNOWN" weightage="60" keywordseo="boe" source="Orion">BoE</keyword>'s monetary policy committee raised its main interest rate by 25 basis points from 0.25% to 0.5%, in a decision announced Thursday. It followed a 15 basis point hike in December, which was the first upward move since 2018.It comes as global investors brace for the US Federal Reserve to <a href="https://origin.markets.businessinsider.com/news/stocks/federal-reserve-hints-raise-interest-rates-inflation-fomc-meeting-january-2022-1">hike its main rate</a> in March for the first time since December 2018.Central banks are dialing back the huge monetary stimulus they injected to support economies in 2020 and 2021.Inflation is soaring in many economies around the world, as global supply chains struggle to keep up with a sharp rebound in demand.In the UK, inflation hit a 30-year high of 5.4% year-on-year in December. The Bank of England, like other central banks such as the Fed, had played down the chances such red-hot price rises.But the BoE said Thursday: "Given the current tightness of the labour market and continuing signs of greater persistence in domestic cost and price pressures, the committee judges that an increase in bank rate of 0.25 percentage points is warranted at this meeting."Read more: <a href="https://www.businessinsider.com/stock-market-strategy-2022-big-investing-themes-to-profit-bofa-2022-1?r=US&amp;IR=T">Bank of America lays out the 10 key investing themes its vast team of strategists and economists are watching closely — and reveals how investors can profit from each of them</a>Many strategists think the BoE will continue hiking interest rates in 2022. There's uncertainty about the pace and magnitude of increases, however.<a href="https://www.cmegroup.com/trading/interest-rates/bank-of-england-watch-tool.html">Market prices</a> suggest traders on average expect the BoE to gradually raise interest rates to around 1.5% by the end of the year."We still expect two to three hikes in 2022, though recent strength in data now makes three more likely," Peder Beck-Friis, portfolio manager at PIMCO, said in a note before the meeting. "That would bring the policy rate to 1% by year end." The <keyword id="6441867" type="UNKNOWN" weightage="60" keywordseo="pound" source="Orion">pound</keyword> rose after the announcement, and was up 0.3% against the dollar at $1.3614.<a href="https://markets.businessinsider.com/news/stocks/why-are-stocks-down-explained-federal-reserve-earnings-ukraine-tech-2022-1">Global stocks have fallen</a> in 2022 so far as investors come to terms with a new reality in which central banks are no longer supporting economies and <keyword id="11893875" type="UNKNOWN" weightage="100" keywordseo="markets" source="Orion">markets</keyword>.The Fed last month all but confirmed it will raise interest rates in March, with traders expecting the federal funds target range to increase to 0.25% to 0.5%.

The Bank of England just hiked interest rates again, as central banks get serious about red-hot inflation

Latest FD interest rates offered by HDFC, SBI, ICICI and PNB

<ul><li>The <keyword id="6355253" type="UNKNOWN" weightage="60" keywordseo="federal-reserve">Federal Reserve</keyword> remains averse to <keyword id="741038" type="PERSON" weightage="60" keywordseo="negative-interest-rates">negative interest rates</keyword> despite the gloomy economic backdrop, Chairman <keyword id="1727754" type="PERSON" weightage="60" keywordseo="Jerome-Powell">Jerome Powell</keyword> said Wednesday.</li><li>The US economic trajectory is still "highly uncertain and subject to significant downside risks," and additional aid is likely necessary stage a recovery, Powell added in a <a href="https://www.youtube.com/watch?v=tuPIJvLhQmc&amp;feature=emb_titleitle">videoconference</a> with the Peterson Institute for International Economics.</li><li>The refusal to push rates lower comes one day after President Donald Trump <a href="https://markets.businessinsider.com/news/stocks/trump-again-calls-negative-interest-rates-us-tweet-gift-fed-2020-5-1029193284">renewed his call for negative interest rates in the US</a>.</li><li><a href="https://www.businessinsider.com/?utm_source=markets&amp;utm_medium=ingest?utm_source=markets&amp;utm_medium=ingestm=ingest">Visit the Business Insider homepage for more stories</a>.</li></ul>The Federal Reserve may need to act further to pull the US <keyword id="34412" type="ORGANIZATION" weightage="60" keywordseo="economy">economy</keyword> out of its slump, but negative <keyword id="6371181" type="UNKNOWN" weightage="60" keywordseo="interest-rates">interest rates</keyword> are still out of the question, Chairman Jerome Powell said Wednesday.Potential for the unconventional policy tool resurfaced on Tuesday after President Donald Trump praised the "<a href="https://markets.businessinsider.com/news/stocks/trump-again-calls-negative-interest-rates-us-tweet-gift-fed-2020-5-1029193284">gift</a>" and called on the US to adopt such rates. Even as the current downturn grows "significantly worse than any recession since World War II," the <keyword id="6358156" type="ORGANIZATION" weightage="60" keywordseo="central-bank">central bank</keyword> hasn't changed its stance on pushing its <keyword id="37018" type="PERSON" weightage="60" keywordseo="interest-rate">interest rate</keyword> lower, Powell said."The committee's view on negative rates has not changed. This is not something we're looking at," he said in a <a href="https://www.youtube.com/watch?v=tuPIJvLhQmc&amp;feature=emb_titleitle">videoconference</a> with the Peterson Institute for International Economics.Read more: <a href="https://www.businessinsider.com/stock-picks-to-buy-25-cheap-small-cap-acquisition-targets-2020-5">These 25 under-the-radar companies have been neglected for years — but BTIG says that makes them tempting M&amp;A targets with big stock upside</a>While Powell stopped at detailing what additional actions the <keyword id="45672" type="ORGANIZATION" weightage="60" keywordseo="Fed">Fed</keyword> may take, he noted the US economic rebound will likely be more chaotic than first expected. The nation's path forward remains "highly uncertain and subject to significant downside risks," the chair warned in his prepared remarks."There is a sense that the recovery may come more slowly than we would like, but it will come. And that may mean that it's necessary for us to do more," Powell added in a question-and-answer portion.Powell's bleak tone immediately shook US <keyword id="31671" type="CITY" weightage="100" keywordseo="markets">markets</keyword>. Equities <a href="https://markets.businessinsider.com/news/stocks/stock-market-news-today-index-reaction-fed-powell-economy-stimulus-2020-5-1029197793">erased early gains and opened lower on Wednesday</a> as the Fed chief detailed his view of the current economic backdrop.Read more: <a href="https://www.businessinsider.com/stocks-picks-to-buy-investing-strategy-for-inflation-morgan-stanley-2020-5">MORGAN STANLEY: Buy these 20 stocks built to profit from a mounting inflation comeback that will alter the investing landscape</a>The Fed's refusal to drag rates below zero could be a blessing in disguise for long-term investors, Seema Shah, chief strategist at Principal Global Investors, said. Any short-term benefits such policy would bring the US would likely give way to long-term market dislocation, she added."What's more, experience outside the United States suggests that slashing rates has distorted financial markets, crippled bank lending and threatened pensions systems worldwide," Shah said. "Indeed, central banks have been reconsidering the wisdom of negative policy rates, with the Swedish Riksbank exiting negative rates altogether."The central bank is more likely to boost its asset purchases and lending programs before considering negative rates, the strategist noted. The Fed <a href="https://markets.businessinsider.com/news/stocks/federal-reserve-emergency-corporate-bond-etf-purchases-coronavirus-policy-economy-2020-5-1029191923">began its corporate-bond ETF purchases on Tuesday</a>, opening the first of its credit facilities for companies struggling through the virus-induced collapse.The Fed's interest rate sits at a range of 0% to 0.25%, a historic floor last implemented during the 2008 financial crisis.Read the original article on <a href="https://www.businessinsider.com/negative-interest-rates-not-considered-federal-reserve-policy-jerome-powell-2020-5">Business Insider</a>

The Fed won't use negative interest rates to counteract the coronavirus recession, chairman Jerome Powell says

Hopes of a minor fall in <keyword id="6371181" type="UNKNOWN" weightage="40" keywordseo="interest-rates">interest rates</keyword>, especially on <keyword id="6354730" type="UNKNOWN" weightage="40" keywordseo="Home-loan">home loan</keyword>s, were dashed last week after the RBI hiked its key rates in its policy review. Home loan borrowers, especially those crushed by a heavy <keyword id="6357050" type="COMPANY" weightage="40" keywordseo="EMI">EMI</keyword>, have been looking at the RBI for some solace for a while now. 
 
Generally, borrowers can do very little other than prepaying a part of the loan (if they have surplus cash) to reduce the interest burden or increasing the EMI (if they can afford it) to reduce the tenure and therefore, the overall interest paid. 
 
However, some experts believe home loan seekers and existing borrowers looking to switch lenders can consider experimenting with some out-of-the-ordinary home loan schemes. Such loans, which are linked to an overdraft facility, are offered by SBI, HSBC and Standard Chartered, among others. 
 <keyword id="6400347" type="COMPANY" weightage="40" keywordseo="CitiBank">Citibank</keyword> offers a home loan scheme that is a combination of a simple term loan and a credit line facility. However, most people are unaware of the existence of these schemes, as they are not promoted heavily. 
 "Such schemes can prove to be very useful, but the borrower needs to understand the product’s workings carefully before going ahead," says Vipul Patel, director of mortgage advisory firm Home Loan <keyword id="159121" type="POSITION" weightage="40" keywordseo="advisors">Advisors</keyword>. 
 
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	Unlike regular home loans which are standard offerings, features of these products vary with each bank. The only thing that is common among them is the home loan is linked to an overdraft facility. Any surplus money (apart from EMI) you deposit into the account will reduce the principal outstanding (only for the purpose of calculating interest), thus reducing your interest outgo.
You can also withdraw the surplus amount parked in the account, if required, though you may have to pay the applicable transaction charges per withdrawal. Again, it depends on the bank's policy. 
 "The deposits into the account actually offset the interest payable for that many number of days and, as a result, reduces the loan tenure as also the interest paid over the term of loan. This is more tax-effective as interest saved (<keyword id="25450" type="UNKNOWN" weightage="40" keywordseo="savings">savings</keyword>) is not taxable, while income is," says Patel. That is, if you were to <keyword id="47916" type="UNKNOWN" weightage="40" keywordseo="invest">invest</keyword> the amount in fixed deposits, the interest earned would be taxable. If used efficiently, it can reduce both your loan's tenure and the interest paid. <div style="page-break-after: always;">
	&#xa0;</div>
While it may sound like a win-win deal, there is a flipside to these products. Most importantly, they charge at least 0.25% more than a regular home loan. For instance, HSBC's Smart Home's rate is 0.25% higher than its regular home loan. Moreover, some banks also levy an annual fee of up to 1% of outstanding balance or loan amount, which is quite substantial. 
 "You need to carry out a cost-benefit analysis to ascertain whether a simple part pre-payment is better than depositing surpluses," says VN Kulkarni, chief credit counsellor, Abhay Credit Counselling Centre. Instead, it might be wiser to go for banks that charge an <keyword id="37018" type="UNKNOWN" weightage="40" keywordseo="interest-rate">interest rate</keyword> as low as 9.5%, he reasons. 
 
Simply put, you will benefit from these products, primarily if you direct all your savings into this account and are confident of parking a surplus. That means, it is not going to help if you are stretched for paying the basic EMI itself.

Smart Ways To Manage Your Home Loan Interest Burden

The recent decision of the <keyword id="79248" type="CITY" weightage="20" keywordseo="Bank-of-Japan">Bank of Japan</keyword> (BOJ) is seen by many as a surprising move. The <keyword id="35189" type="COMPANY" weightage="20" keywordseo="asian-markets">Asian markets</keyword> seemed to move in a positive direction post the announcement as Japan adds another lever to its arsenal of weapons to revive its mildly recovering economy. However, the policy choices for the BOJ seem to be running out. It is already engaged in a massive bond-buying program of buying 80 trillion yen or $674 billion in assets a year which has lead to a ballooning of debt close to 230 percent of the GDP, the highest among the major economies of the world. 
 
Two decades of stagnation and a high debt coupled with a need to boost demand has meant that the task is not an easy one to achieve. This is where the bond buying program was initiated by the BOJ under the leadership of the BOJ governor Haruhiko Kuroda. 
 But the success has been mixed. The negative interest rate announcement is the first time for BOJ and was a 5-4 close tie in favour of <keyword id="741038" type="UNKNOWN" weightage="20" keywordseo="negative-interest-rates">negative interest rates</keyword> with Quantitative and Qualitative Monetary Easing (QQE). It comes in the wake of weak data on the economic front especially as inflation seemed to be on the lower side (0.5%) nowhere close to the target set by BOJ of 2 percent despite the BOJ's monetary stimulus over the past some time now. Also consumer spending in December dropped 4.4 percent as compared to a year earlier which is also seen as a key reason behind the latest decision. 
 
It is interesting to see how the latest decision falls in line with the broad program of 'Abenomics' which is based on the three arrows of fiscal boost, monetary expansion and structural reforms. So far, the work on all three is an ongoing program but still outcomes have yet to prove that ''Abenomics' has been very successful. Monetary stimulus is a major component in 'Abenomics', and the BOJ seems to be fighting the 'deflationary mindset' which might just put Japan back in the throes of deflation. 
 
It must be noted that the (QQE) with negative interest rate' is designed to enable the BOJ to 'pursue additional monetary easing across three dimensions, combining a negative interest rate with quantity and quality'. Another feature is that it comes post the resigning of the Economy Minister of Japan Akira Amari over allegations of bribery yesterday. 
 
The QQE with negative interest rates decision will mean that bank deposits with the BOJ will be divided into three tiers. The multiple tier system will work in the following way: Existing current account balances will earn a positive 0.1 positive interest rate. Required reserves held at the central bank by financial institutions will earn zero interest. An additional current account deposit would incur a minus 0.1 percent rate. This means that financial institutions will earn a negative interest rate from putting 'excess reserves' with the central bank, and the BOJ wants to incentivise supply of liquidity in the market. Already several European central banks, as well as ECB, have gone in the negative interest rate territory. 
 Last week in an interview with Shekhar Gupta, on NDTV's 'Walk The Talk', <keyword id="1895647" type="ORGANIZATION" weightage="20" keywordseo="RBI-Governor-Raghuram-Rajan">RBI Governor Raghuram Rajan</keyword> had remarked that at present the central banks across the world are engaged in increasing asset prices with the hope that the underlying economic activity will match these increased prices. This is what the recent BOJ decision hopes it would do to revive its economy. 
 
For India and other economies, it means that the era of easy money is not over despite the Fed increasing rates once in the past year. With the Bank of Japan and ECB engaged in bond buying programs the era of easy money may well not be over. Over the next year, significant developments are in stock in the monetary policy space the world over. The BOJ is just the beginning. 
 
(The article is co-authored with Sankalp Sharma, Senior Researcher at the Institute for Competitiveness, India. Amit Kapoor is Chair, Institute for Competitiveness &amp; Editor of Thinkers. The views expressed are personal. He can be reached at amit.kapoor@competitiveness.in and tweets @kautiliya) 
 
(Image: Reuters)

Here's how Bank of Japan’s recent monetary policy decision will work out

The Bank of England has left its target interest rate unchanged as expected.
Furthermore, the BoE has left its stimulus measures unchanged as expected.
Markets aren't moving.
Canadian banker Mark Carney will take the helm at the BoE from Mervyn King this summer.

The Bank Of England Holds Interest Rates Steady

New Delhi, Interest rate is likely to remain high for the moment, <keyword id="192432" type="General" weightage="20" keywordseo="reserve-bank-governor" source="Orion">Reserve Bank Governor</keyword> <keyword id="6359111" type="General" weightage="20" keywordseo="shaktikanta-das" source="Orion">Shaktikanta Das</keyword> said, stressing the central bank will remain extra vigilant and keep "Arjun's eye" to ensure a sustained decline in inflation. The lending rates are ruling high after the RBI cumulatively hiked the <keyword id="714684" type="General" weightage="20" keywordseo="key-policy-rate" source="Orion">key policy rate</keyword> (repo) by 250 basis points since May 2022 in a bid to tame inflation which touched a high of 7.44 per cent this July. The consumer price index (CPI) based retail inflation is now declining and fell to 5 per cent in September. The government has mandated the central bank to ensure inflation remains at 4 per cent with a margin of 2 per cent on the either side. "Interest rate will remain high. How long they will remain high, I think only time and the way the world is evolving will tell," the governor said in response to a query at Kautilya Economic Conclave 2023. On the sidelines of the Conclave, Das said the RBI remains very focused on the inflation dynamics. "We are extra vigilant and we stand ready to take whatever action that needs to be taken. We need to see sustained decline in inflation...our objective is to reach 4 per cent," he said. On elevated crude oil prices in the international market, he said, "what matters is the pump prices in India". The pump prices of petrol and diesel are important as far as inflation in India is concerned, Das added. Responding to queries on impact of crisis in Middle East, the governor said that in the last fortnight, US bond yields have risen, which has wider implications for other economies. Crude oil prices have also gone up. "Some of these uncertainties were there, but they have become more pronounced in some sense. What is different in the context of India, we are impacted by whatever is happening all over, no doubt on that. "Our macroeconomic fundamentals continue to be sound. Eventually, in these uncertain times, what matters is how strong is your macroeconomic fundamentals, how strong is your financial sector. I think on both these parameters India is well placed," Das said. He also said the dollar index has become strong and bond yields in the US have reached all-time highs. "But if you look at the volatility of the Indian rupee, from January 1 till now, the rupee depreciation is 0.6 per cent whereas on the other side, the appreciation of the US dollar for the same period has been 3 per cent. So rupee is stable. We are there in the forex market to prevent excessive volatility," the governor added. In his address at the Conclave, Das said that in the prevailing global environment of slowing growth and stubborn inflation, especially in the last few miles before reaching the target, economic activity in India exhibits resilience on the back of strong domestic demand. "Real GDP growth for 2023-24 is projected at 6.5 per cent and India is poised to become the new growth engine of the world," he added. Das said the RBI remains "extra vigilant" on the evolving inflation dynamics. In the current situation, monetary policy must remain actively disinflationary to ensure that ongoing disinflation process progresses smoothly, he said. "In the world we live in today, beyond giving a generalised kind of forward guidance that we will be very alert, we will be extra vigilant, we will monitor the inflation-growth dynamics hawk's eye or Arjuna's eye...we will remain alert and we will be very prompt in our response," said Das.

Only time will tell how long interest rate will remain high: Shaktikanta Das

<ul class="summary-list"><li>The <keyword id="106488" type="UNKNOWN" weightage="60" keywordseo="bank-of-england" source="Orion">Bank of England</keyword> raised borrowing costs for the third meeting running Thursday, putting its main interest rate up to 0.75%.</li><li>The BoE said the Ukraine conflict is set to push <keyword id="11894140" type="UNKNOWN" weightage="60" keywordseo="inflation" source="Orion">inflation</keyword> even higher by driving up energy prices.</li></ul>The Bank of England raised <keyword id="6371181" type="UNKNOWN" weightage="60" keywordseo="interest-rates" source="Orion">interest rates</keyword> for a third meeting running Thursday, saying the Ukraine conflict is set to push inflation even higher.It came a day after the US <keyword id="11895523" type="UNKNOWN" weightage="60" keywordseo="federal-reserve" source="Orion">Federal Reserve</keyword> <a href="https://www.businessinsider.com/federal-reserve-hikes-interest-rates-inflation-higher-costs-loans-mortgages-2022-3?r=US&amp;IR=T">hiked interest rates</a> for the first time since 2018, as <keyword id="11962842" type="UNKNOWN" weightage="60" keywordseo="central-banks" source="Orion">central banks</keyword> pivot to take a tougher stand against price rises.The BoE's Monetary Policy Committee raised the main interest rate to the pre-pandemic level of 0.75%, from 0.5%.In March 2020, the MPC slashed the main rate to a record low of 0.1% to stimulate the <keyword id="11893570" type="UNKNOWN" weightage="60" keywordseo="economy" source="Orion">economy</keyword> as the coronavirus pandemic hit. But it has been <a href="https://markets.businessinsider.com/news/currencies/bank-of-england-interest-rates-inflation-uk-economy-federal-reserve-2022-2">gradually raising it</a> again since December.Like numerous other economies, the UK is facing red-hot inflation, with the consumer price index hitting a 30-year high of 5.5% year-on-year in January.Although the Ukraine conflict threatens to derail European economies, central bankers think it will add to global inflation because it has driven up energy prices."The invasion of Ukraine by Russia has led to further large increases in energy and other commodity prices including food prices," the MPC said in a statement Thursday."Global inflationary pressures will strengthen considerably further over coming months, while growth in economies that are net energy importers, including the United Kingdom, is likely to slow."The BoE said Thursday that inflation could now rise to 8% or more in the second quarter of the year, having previously expected it to peak at around 7.25% in April.The <a href="https://markets.businessinsider.com/currencies/gbp-usd">pound</a> fell after the decision and was last down 0.15% against the dollar to $1.312. The UK's <a href="https://markets.businessinsider.com/index/ftse_100">FTSE 100</a> stock index pared its gains, and was up 0.33%.Britain's central bank tempered its language about the need for future interest rate increases, saying that they "may be appropriate." In February, the BoE said further hikes were "likely to be appropriate."One policymaker on the nine-person committee, Deputy Governor Jon Cunliffe, voted to hold rates steady at 0.5%. He said that the Ukraine conflict posed risks to the economy, according to minutes from the decision meeting.Traders expect the BoE to raise interest rates to above 2% by the end of the year, market pricing on Wednesday showed. Yet Vivek Paul, chief UK investment strategist at BlackRock, said: "We think overtly aggressive rate hikes would exact a heavy toll on growth."Clear communication will be key, in our view, for the Bank to avoid creating confusion by over-tightening financial conditions and hurting the real economy."Read more: <a href="https://www.businessinsider.com/crypto-investing-3-etfs-to-buy-the-bitcoin-dip-without-owning-coins-2022-3" target="_blank" rel="noopener noreferrer">An investing expert explains how to add crypto exposure to your stocks portfolio through ETFs - and names 3 top ones to own</a>

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