Over-heating of Economy Subject: Economy Section: National INCOME Context: India can grow for a prolonged period without running into overheating problems says CEA An overheated economy is when the economy grows too fast. An overheated economy reaches the limits of how much output it can produce to meet the demand while using all […]
Monetary policy committee continues status quo on repo rate at 6.5% Subject : Economy Section: Monetary Policy In News: Reserve Bank of India (RBI) Thursday left the main policy instrument, repo rate, unchanged at 6.50 per cent for the second consecutive monetary policy Key points: Has kept rate unchanged after hiking it consecutively […]
RBI gives green signal to first loss default guarantee (FLDG) framework Subject : Economy Section: Monetary Policy FLDG: FLDG allows Indian fintechs to partner with banks and NBFCs Banks and NBFC act as the third party in arrangement between customer (who takes loan) and the Fintec company The first hit on a default […]
CACP recommends bringing urea under NBS Subject : Economy Section: Monetary Policy Key Points: CACP has recommended the Centre to bring urea under the nutrient-based subsidy (NBS) regime to address the problem of imbalanced use of nutrients. Main cause of the nutrient imbalance is price distortions resulting from fertilizer subsidies, which have grown […]
RBI’s VRRR auction gets tepid response, again Subject :Economy Section: Monetary Policy RBI uses reverse repo auctions to suck excess liquidity from the banking system. Banks choose to park the excess liquidity through these Reverse Repo auctions when: There is certainty about near term interest rate The reverse repo rate is sufficiently higher […]
Inflation Targeting by RBI- Is it effective ? Subject :Economy Section: Monetary Policy How inflation is supposed to be controlled by RBI through change in Repo Rate: Repo rate is the rate at which RBI lends to the banks, the raising of repo reduces inflation through two channels of demand reduction: Consumption: Making […]