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88 ArticlesMacro

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Banks Are Borrowing Rs. 243,000 crores from the RBI as Government Tax Collections Stifle Liquidity

Banks are borrowing insane amounts from the RBI, but there is no liquidity problem. If there was a liquidity issue, we would be seeing rate spikes in the ...
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Banks Are Not Benefiting From The Rate Cut: They Are Not Borrowing From The RBI

You think banks are benefiting from the RBI rate cut? The RBI rate cut reduces the rate at which RBI lends money to banks. So banks would benefit if they were ...

What We Did Not Expect, Happened: 50 Basis Point Rate Cut!

RBI has cut rates by 50 basis points – which is 0.50%. That means everything is cheaper! Even in stock markets! (Nifty is currently lower. But it’s ...

Will Rajan Cut Rates? 10:30 AM Edition

Dear Mr. Rajan, You are being asked, no, told, no, ordered to cut rates today. This almost sounds like something you should rebel against, because no one ...

India Gets Protectionist: Stop Those Pesky Foreigners Who Make Things Cheaper Than Us

We’re getting into protection zones. The Finance Ministry yesterday announced a 20% “safeguard” duty on steel. This is to protect domestic ...

Indirect Taxes Up Big Time on Fuel Duties and Gold, Good For Government, Not So Much For Anyone Else

Apparently, the Indirect tax collections (Service Tax, Excise Duty and Customs Duty) are up 37% in May 2015 over May 2014. But is this really something we ...

Current Account Deficit Falls to 0.2% of GDP, RBI Buys Massive Quantities of Incoming Dollars

The current account deficit for the March quarter of 2015 came in at -1,286 million, which is a big relief, even if it’s marginally higher than the ...

Correction: Wrong Deflator – It's Actually 1.5%

Yesterday we had said that the GDP deflator was 0.2%. This is wrong. The new method uses something called GVA – or Gross Value Added – to indicate ...

GDP Growth in March 2015 Falls to 6.1%, Low Inflation Helps As Nominal Growth Nears Decade Low

India’s Q4 GDP Came in at a low 6.1% for Q4 2015, as measured by the new method (which states GDP growth as much higher than the old method). Growth in ...

The Fed Wriggles Out By Removing “Patient” From Statement

The Fed went a little crazy yesterday. They didn’t want to spook the market, but they did want to say okay we’re not really in a zone that says we ...