Download - Street Groove 15
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5/18/2018 Street Groove 15
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Team members
Kundan Kumar, IM, [email protected], 7760055700
Akhand, IM, [email protected], 77740970!6
A"aneesh, IM, a"aneesh.kulshres#[email protected] , 976$9470%9
Manmee#, IM, manmee#[email protected], %97796$7$Abhishek, IM, [email protected], 979940
Anish Kumar, IM, [email protected], 99749960
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected] -
5/18/2018 Street Groove 15
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. &'ec# o( in#eres# ra#e mechanism onin)a#ion
Marke# in#eres# ra#e
*ecrease inconsum+#ion and
reduc#ion inin"es#men#
educ#ion in demand
-oer in)a#ion
Increase inconsum+#ion and
increase inin"es#men#
Increase in demand
Increase in in)a#ion
Increase *ecrease
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!. Ke/ +olic/ ra#es and #heir im+ac# oneconom/
Key rates use by the Reserve Bank of Indiato tweak the supply chain curve in theIndian economics
Repo rate : e+o or e+urchase ra#e is #he ra#e a# hich I lends money#ocommercial banks. 2rac#icall/ im+lemen#edb/ I b/ bu/ing go"ernmen# bonds(rom banks i#h an agreemen# #o sell #hem back a# a 3ed ra#e . onsidered #o
#he single mos# im+or#an# #ool i#h #he I. urren#l/ s#ands a# 7.!5 .
Cash ReserveRatio (CRR) :
re(ers #o a +or#iono( de+osi#s as
cash8 hich banksha"e #o
kee+main#ain i#h
#he I. urren#l/a# 4.
Reverse repo rate :
Is #he eac# o++osi#eo( re+o ra#e.
The ra#e a# hich Iborros mone/ (rom#he banks or bankslend mone/ #o #heI8. urren#l/ a#
6.!5
Statutory Liquidity
ratio (SLR) : re(ers#o a +or#ion o(
de+osi#s as cash8hich banks ha"e #o
in"es# i#h #he I, in#he (orm o(go"ernmen#
securi#ies. urren#l/a# !.5
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Reporate
-endingra#e o(
banks
orroing(rom #he
marke#
Mone/demand
marke#
Impact of Key rates use by the Reserve
Bank of India
In)a#ion
Rever
se
Reporate
*e+osi#s o(
bank in I
Mone/ (or
bank #o lend
Mone/ )o in
marke#
CRR Minimum
balance o(banks in
Mone/ (orbank #olending
Mone/ )o inmarke#
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$. :olloing (ac#ors con#ribu#e grea#l/
#oards de+recia#ion o( Indian urrenc/
-oera+i#alIn)os
*ue #o increased in#eres# ra#es in ;igh in)a#ion discourages #he in"es#ors (rom in"es#ing in India andhence de"alues #he currenc/
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urrenc/ de"alua#ion has bo#h+osi#i"e as ell as nega#i"e im+ac#
Im+ac# o(urrenc/
*e"alua#ion
2osi#i"eIm+ac#
?ega#i"eIm+ac#
&+or# orien#edcom+anies s#and #obene3# (rom a eakru+eeIT, Te#ilee#c8
Increase in im+or#billIndus#riesde+enden# u+on(oreign im+or#s aread"ersel/
a'ec#ed&:er#ilier Indus#r/8
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4. BA*MA2 :B I K&C 2B-ICAT&A< BM& *BE?
*ue #o #his mone/ circula#ed in econom/ ill comedon so #o main#ain #he liFuidi#/ in Indian marke#s Is#e+s in i#h i#s #ools
Dro#h is reFuired and #ha# needs ra#e cu# bu# Do"#needs #o be cau#ious no# #o #rade shor# #erm gro#h (orlong #erm in)a#ion
TBB-< :B MA?ADI?D &B?BMC
&2B AT&
&G&
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5. oadma+ (or India=s 3scal +olic/
>igher TaD*2a#io
Indias #a#oD*2 ra#io has been be#een % and ! +er cen# o"er #he +as# #odecades. ;sing D
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6. Im+ac# o( im+ending ;< in#eres# ra#erise on Indian &conom/
Increase in ;