look news india
The Monetary Policy Committee of the Reserve Bank of India (RBI) is likely to meet this week and may extend the rate cut till December with no change on interest rates.
Amid analysts' expectations, banks are selectively increasing deposit rates and interest rates. People are finding it difficult to borrow money as it has become expensive. However, it is believed that banks are under pressure to increase interest rates due to the decrease in deposits in banks. That is, now people are turning to earning by investing interest income in other areas instead of depositing it in banks.
State Bank of India Chairman Dinesh Khara said that the market's expectations that the US Federal Reserve might cut interest rates have now backfired. Many adverse changes are taking place in the market. Of course, it would be wrong to assume that a cut in the US Federal Reserve rate means that other markets will adopt a bearish stance. It should not be forgotten that the Bank of England has recently cut interest rates for the first time in 16 years. After this, Australia comes next in this order. On the other hand, Japan has increased interest rates. All the central banks of the world adopt different approaches.
The chairman of another bank said that the ongoing struggle for resources will continue for the next few quarters. We are passing on the burden of increased deposit backlog to borrowers in the form of higher MCLR rates and we may also increase the spread over the repo rate.