INSUBCONTINENT EXCLUSIVE:
The plentiful supply of cash in the system is pushing banks to park excess money with the RBI at the reverse repo rate of 4.90 per cent
The reasoning goes that payouts to banks on this account take away from money that could go as dividend to the government.
Banks have been
The central bank may have paid them Rs 8,000-10,000 crore in the past few months, calculations by traders show
Some market participants peg this a little higher as variable reverse repos offer a few basis points extra.
In December and January, the
average daily absorption under the Liquidity Adjustment Facility (LAF) amounted to Rs 2.61 lakh crore and Rs 3.18 lakh crore, respectively
The bank, which for long believed in liquidity deficit for rate transmission, shifted to neutral in 2016, then to accommodative in
the RBI is determined to help revive the economy and lower interest rates thanks to greater liquidity will help drive investment and
Ritesh Bhusari, deputy general manager, treasury, South Indian Bank
Balasubramanian, CEO, Aditya Birla Sun Life MF
record Rs 1.76 lakh crore payout to the government, which is more than double the Rs 68,000 crore that it gave the previous year
crore dividend from the government to plug the fiscal deficit or cover the excess of expenditure over revenue, traders said.
