The Reserve Bank of India (RBI) expects retail inflation to come under control at 5.2 per cent in the next financial year beginning April. The central bank is mandated to keep retail inflation in a range of 2-6 per cent. Both the countries are key suppliers of foodgrains, edible oil, fertilisers and energy resources such as crude oil and natural gas.
Reserve Bank is mulling to adopt the "expected loss" approach for loan provisioning. At present, the banks follow the "incurred loss" approach, where money is set aside after an asset turns sour. RBI will be releasing another discussion paper on a revised framework for securitisation of stressed assets
The Reserve Bank is expected to increase the repo-rate or the short-term lending rates by 50 basis points in a bid to tame inflationary pressure. India's trade deficit more than doubled to USD 27.98 billion in August due to increased crude oil imports. Import of 'petroleum, crude & products' stood at USD 17.7 billion in August this year, an annual increase of 87.44 per cent.
On August 10, the RBI had cancelled the licence of Rupee Co-operative Bank Ltd as the lender did not have adequate capital and earning prospects. However, the RBI said that in compliance to an order of the High Court of Bombay, its direction will become effective after six weeks i.e, from August 10 onwards.