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The India Banking policy punch: What next?

Honestly though, it is a comfortable cosy for the ears when the Reuters breaking views analyst points out that the BoE and the Feds have a lot to learn from the active tools in use by India and China to manage the inflation and liquidity twins. We have the Reserve Ratios ( 7 times hiked in 12 months and two-three more pending in 2011 from China ) we have the unending hikes in bank rates and many choices of bank rates that are free for use by policy makers everytime that give us a flexibility in policy action and indeed the annual exercise in January was thus even paced and a precursor to bullish markets rather than panic in 2011 unlike China, and a precursor more importantly to rising rates throughout the year and a probable habituating to high inflation expectations, with RBI expecting the min in FY2011 to be 7%

Credit in China has again run amok in January itself to RMB 1.2 Trillion in less than a month, and thus internally RRRs will be higher still for the big banks and they have much better control on tactical admin measures and statistics when it comes to inflation reporting BoE in the meantime has voted against the rate hike (1-6 with two nowhere lines) as it should considering the worries of a fragile growth and Portugal and Spain are finally seeing spreads coming down ( the irish are not so lucky and the EFSF is another great state investment vehicle). For us in India, a lot of active investing in 2010 means a rather dull capital markets in 2011 which does not take us away from any GDP targets or fund raising exercises and the weaning of winners and super rich lists shucking the oysters all year round

2 comments on “The India Banking policy punch: What next?

  1. Pingback: Tweets that mention The India Banking policy punch: What next? | The Banking and strategy initiative --

  2. Sadie Jeans
    October 12, 2011

    Hi, Thank you for this specific material I had been seeking all Google to be able to locate it!


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This entry was posted on January 26, 2011 by in Amitonomics, Banking, China, Emerging Markets, Home and away, India, Mergers etc and tagged , , , , , , , .


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