- The Central Bank of India raises interest rate while inflation soaring up.
and reparchase rate to 5.25% from 5%. according to the median forecast of 25 economists. Inadequate and
dialapidated roads and ports and insufficient capacity in power drive up prices. It increases the cost of trans-
port of raw materials for industrial production. Domestic demand pressure along with a rise in global comm-
odity price account for a spurt in inflation. The nation's wholesale price inflation rate held at a 1.7%, a month
high of 9.9% in March.
The RBI may raise the proportion of deposites that lenders needs to set aside as reserve ratio might go up
to 6% from 5.75%. India's $1.2 trillion economy may grow at 7.5% in 2010. the fastest pace after China
among the major economies.
- India's rupee likely to strengthen- India Rupee likely to strengthen 3.2% in 3months as government
bank predicts the currency, has raisen 3.8% so far this year will climb to 43.2 per dollar. The Cenral Bank
may favour gains to make imports cheaper. The rupee slipped 0.6% from the end of last week to trade
at 44.58% per dollar in Mumbai, according to data compiled by bloomsberg. It reached 44.165 in Apr-15
Asia's 3rd largest economy plans to raise $8.9billion selling shares in state owned companies in the fiscal
year through March2011.
India's benchmark 10year bond yields 8.07%compared with 3.75 for similar maturity US debt and
1.34% for those in Japan. Overseas investors holding of Indian bonds have more than doubled in the
past years to a record $12.2billion according to securities and exchange boards of India. Net purchase
this year already total 4.8dollar billion, more than the combined inflow of 2008 and 2009.
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