Issue: 1237
· RBI says fully prepared to
tackle ‘Mythos’ cyber threat; advisories issued to banks.
· After courts, RBI,
independent reviewers clear HDFC Bank; persistence of crisis narrative raises
questions.
· RBI keeps repo rate unchanged
at 5.25%, policy stance neutral.
· Rupee rises 81 paise to close
at 94.93 against US dollar.
· SBI Mutual Fund buys stakes
in 2 Adani group firms for Rs.5,747 cr.
· Maruti launches recurring
deposit loan scheme for small car-buyers.
HIGHLIGHTS OF RESOLUTION OF MPC DT 3-5 JUNE
The Monetary Policy Committee
(MPC) held its 61st meeting from June 3 to 5, 2026, under the chairmanship of
Governor, RBI. The key points of the resolution are;
· The MPC voted unanimously to keep the policy repo rate
unchanged at 5.25 per cent. Consequently, the SDF rate remains at 5.00 per
cent and the MSF rate and the Bank Rate remain at 5.50 per cent.
OUTLOOK
· Real GDP growth for 2026-27 is now projected at 6.6 per
cent (against 6.9 percent projected earlier).
· CPI
inflation for 2026-27 is projected to be 5.1 per cent with Q1 at 4.2 per cent; Q2
at 5.1 per cent; Q3 at 5.9 per cent; and Q4 at 5.4 per cent.
· System liquidity, as measured by the net position under the
LAF, stood at an average daily surplus of Rs.2.63 lakh crore since the last MPC
meeting in April 2026.
· As per the latest available data, credit from all sources
grew by 15.4 per cent (y-o-y) in 2025-26 as compared to 12.1 per cent a year
ago.
MEASURES TO ATTRACT FOREIGN
CAPITAL
· For government securities under the Fully Accessible Route
(FAR), the universe of ‘specified securities’ has been expanded by
including all new issuances of 15-, 30- and 40-year tenor G-secs. In addition,
limits pertaining to short-term investment, concentration and individual securities
on FPI investment under the General Route are being removed. These measures
along with the tax benefits provided by the government should help
attract foreign capital for government borrowing.
· The limits for investment by NRIs and OCIs in equity instruments
traded on the stock market without SEBI registration are being increased.
Further, the same facility is being extended to all individual Persons Resident
Outside India (PROIs) at par with NRIs and OCIs.
· A facility of concessional forex swap will be provided
till 30th September 2026 to incentivize ECBs by PSUs.
· Facility for bearing the full hedging cost shall be
provided till 30th September 2026 to AD banks for raising fresh 3–5-year FCNR
(B) deposits.
· It is proposed to restore the time for realisation of export
proceeds to nine months.(which was raised to 15 months in recent past).
India records 7.7% GDP
growth in FY26; Q4 growth comes in at 7.8%: The Indian economy grew 7.7
percent in FY26, up from 7.6 percent projected in the second advance estimates,
official data released by statistics ministry showed on June 5. In FY25, the
real GDP growth was 7.1%.In Q4, the GDP grew 7.8 percent, down from 8 percent
in Q3FY26. The decline in quarter-on-quarter growth was due to a sharp
decline in manufacturing growth – which fell from 7.3 percent in Q4 from 12.8
percent in Q3. Growth is FY27 is expected to
lower by 110 basis points to 6.6 percent – as projected by RBI. The gross value
added (GVA) growth was 7.9 during FY26. In Q4 too the growth was the same. The
full year’s GDP (of FY26) was released with the new base year 2022-23.
(Moneycontrol)
FinMin won’t revise FY27
GDP, inflation forecasts amid Iran war; RBI estimates ‘fair’: CEA: The Finance Ministry will
refrain from issuing separate GDP growth and inflation projections for
FY2026–27 and instead work with the RBI estimates. The RBI, in its June
monetary policy review, lowered its real GDP growth forecast for FY2026–27 to
6.6 percent from 6.9 percent projected earlier, citing risks from elevated
crude oil price. The comments come after
official data showed India’s real GDP growth accelerated to 7.7 percent in
FY2025–26 from 7.1 percent in FY2024–25, providing what the CEA described as a
“strong starting point” for the economy despite emerging external risks.
(Moneycontrol)
Panchayat Advancement Index
Wins Gold Recognition at National e-Governance Awards 2026: The Panchayat Advancement
Index (PAI), a flagship data-driven governance initiative of the Ministry of
Panchayati Raj, has been selected for the Gold Award at the National Awards for
e-Governance 2026 under Category VII – Digital Transformation through the Use
of Data Analytics in Digital Platforms by Central Ministries, States and Union
Territories. The Panchayat Advancement
Index (PAI) is India’s first comprehensive, data-driven framework for assessing
and ranking the performance of Gram Panchayats across the nine themes of the
Localisation of Sustainable Development Goals (LSDGs). PAI 2.0, the latest and
significantly strengthened version of the Index, assesses more than 2.6 lakh
Gram Panchayats against 150 indicators and 230 data points. Based on their
composite scores, Gram Panchayats are classified into five performance
categories.
(PiB)
RBI fines Canara Bank for
violations related to KYC, inactive accounts: The Reserve Bank said it has
imposed a penalty of Rs 41.8 lakh on Canara Bank for non-compliance with
certain provisions, including those related to Know Your Customer norms. The
bank also classified certain accounts as inoperative, despite the last
customer-induced transaction being less than one year old in such accounts. The
RBI said penalties are based on deficiencies in regulatory compliance and not
intended to pronounce upon the validity of any transaction or agreement entered
into by the entities with their customers.
(Economic Times)
RBI has sufficient currency
stocks to replenish ATMs: Governor Malhotra: RBI Governor Sanjay Malhotra
on Friday said there is adequate currency available in the system and assured
that any cash shortages at ATMs would be addressed promptly, amid concerns over
cash availability at select locations.
"If there is a shortage, we will certainly ensure that the shortage
is met," Malhotra said. “Our full effort will be to ensure that wherever
there is a shortage of currency in one or two places at ATMs, we will deliver
currency there promptly and at a rapid pace.”
(Economic Times)
Differential deposit rates
permitted but must be transparent, says RBI Governor amid HDFC Bank row: he Reserve Bank of India has
said banks are permitted to offer differential interest rates on deposits but
only within clearly defined parameters and with full transparency — remarks
that come in the backdrop of allegations against HDFC Bank of routing
differential interest payments to a state government agency through its
marketing budget. "We do allow differential interest rates. We have a very
consistent and very clear policy for deposits as to when banks can have
differential rates," said RBI Governor Sanjay Malhotra. "For certain
categories of people like senior citizens, depending on tenor, you can have
differential rates. But they have to be transparent. You have to display them
to everyone clearly. And any differential rate beyond that is certainly not acceptable."
(Economic Times)
ATM industry calls for
cash-recycler interoperability as costs rise: ATM management service
providers and manufacturers have taken up the issue of interoperability of
cash-recycling machines (CRMs) with multiple banks as logistics costs rise. While
the Reserve Bank of India (RBI) and the National Payments Corporation of India
(NPCI) have allowed interoperability of CRMs among banks (and white-label
firms) for both deposits and withdrawals, the former is yet to be
operationalised. The issue comes at a
time when higher ATM channel costs have prompted the Confederation of ATM
Industry (CATMi) to seek linking the ATM interchange (on cash withdrawals) to
the wholesale price index.
(Business Standard)
Govt signals pragmatism
after India-US trade talks: India and the US on Thursday wrapped up
another round of discussions on an interim trade deal, as both sides sought to
bridge gaps in their respective positions. A statement issued by the government
after the conclusion of the bilateral talks that began on Monday was, however,
non-committal on whether India’s demand for a tariff advantage in the US market
in relation to its key Asian competitors was accepted by the US side. On
Wednesday, even as the talks were on, Washington proposed additional duties of
12.5% on 44 countries, including India, under Section 301 of its Trade Act for
their alleged failure to enforce a ban on forced labour.
(Financial Express)
MSME loan portfolio grows
12.8% Y-o-Y to Rs 46 trillion in April 2026: Loans to micro, small and medium enterprises
(MSMEs) stood at approximately Rs 46 trillion at the end of April 2026,
registering year-on-year (Y-o-Y) growth of 12.8 per cent. However, growth
moderated significantly between December 2025 and April 2026, rising only 3.1
per cent compared with 9.7 per cent during the corresponding period a year
earlier. The number of active loans also declined by 3.5 per cent, against 3
per cent growth in the same period last year.
According to CRIF, the moderation in portfolio growth reflects the
“potential impact of global uncertainty on domestic MSME credit supply.” The
slowdown was most pronounced in the manufacturing and trade segments, which
together account for more than 60 per cent redit.
(Economic Times)
FIIs get I-T
exemption on interest, capital gains for Government securities: In a coordinated move to stabilise
external accounts, the Government and the Reserve Bank of India on Friday
unveiled a flurry of measures aimed at attracting long-term dollar inflows.
Market experts say these steps could help bridge an estimated $40-50 billion
gap in the country’s balance of payments. Through a new ordinance, the government
has exempted Foreign Portfolio Investors (FPIs), overseas investors, and the
Bank for International Settlements (BIS) from capital gains tax on interest and
trading gains from government bonds. Retrospective from April 1, the move
replaces the previous regime where short-term capital gains were taxed at 30
per cent and long-term capital gains on sovereign securities stood at 12.5 per
cent. In addition to the ordinance, the Finance
Ministry said all new 15-year, 30-year and 40-year government bonds will be
part of a fully accessible route. Also, caps on short-term foreign ?investment ?in bonds, concentration limits and the
buying of individual ?bonds have been done away with.
(Business Line)
Gold ETFs shut door on
large investments after discussions with Sebi amid rupee concerns: India's leading mutual fund
players have moved to curb large lump-sum investments into gold exchange-traded
funds following discussions with market regulator Sebi on measures that could
help ease pressure on the rupee and reduce demand for imported gold, people
familiar with the matter told Moneycontrol. While the restrictions are
real, industry executives said their impact on actual gold demand is likely to
be negligible because single investments of the size being restricted are very
rare. The move is, therefore, largely a gesture of support for Prime Minister’s
call to reduce pressure on India's external account.
(Moneycontrol)
Panchayat Advancement Index
Wins Gold Recognition at National e-Governance Awards 2026: The Panchayat Advancement
Index (PAI), a flagship data-driven governance initiative of the Ministry of
Panchayati Raj, has been selected for the Gold Award at the National Awards for
e-Governance 2026 under Category VII – Digital Transformation through the Use
of Data Analytics in Digital Platforms by Central Ministries, States and Union
Territories. The Panchayat Advancement
Index (PAI) is India’s first comprehensive, data-driven framework for assessing
and ranking the performance of Gram Panchayats across the nine themes of the
Localisation of Sustainable Development Goals (LSDGs). PAI 2.0, the latest and
significantly strengthened version of the Index, assesses more than 2.6 lakh
Gram Panchayats against 150 indicators and 230 data points. Based on their
composite scores, Gram Panchayats are classified into five performance
categories.
(PiB)
RBI proposes
tighter disclosure norms for deposit rates, links bulk deposit pricing to
liquidity rules:
RBI
has proposed stricter disclosure requirements for deposit interest rates and a
new framework allowing banks to offer differential rates on bulk deposits based
on their liquidity risk profile, according to draft directions issued on
Friday. Under the proposed changes,
banks will be required to publish their schedule of deposit interest rates on
their websites before the commencement of each business day. Interest rates paid
on deposits must strictly conform to the rates disclosed in advance, preventing
banks from offering rates that have not been publicly announced.
(Economic Times)
DISGUISED ADVERTISEMENT
§ A
practice of posing, masking advertisements as other types of content such as
user generated content or new articles or false advertisements, which are
designed to blend in with the rest of an interface in order to trick customers
into clicking on them.
§ For
example, sending push notifications through mobile application or emails that
appear to be urgent account alerts or important updates but, in effect, are
advertisements for new services or promotions, such as, "Important: Your
account might benefit from this new feature!".
RBI KEY RATES
Repo
Rate: 5.25%
SDF:
5.00%
MSF
/Bank Rate: 5.50%
CRR:
3.00%
SLR:
18.00%
FOREX RATES (RBI REF. RATE)
INR
/ 1 USD : 95.3996
INR
/ 1 GBP : 128.1064
INR
/ 1 EUR : 110.8314
INR
/100 JPY: 59.6400
EQUITY INDEX
Sensex:
74243.34 (-116.67)
NIFTY:
23366.70 (-49.85)
Bnk NIFTY: 54496.25 (+188.40)
Historical
events: June 6 holds
massive significance in history, marked by two monumental milestones. In India,
it is remembered for the Coronation of Chhatrapati Shivaji Maharaj (1674) as
the first Chhatrapati Wikipedia. Globally, it is commemorated as the historic
D-Day invasion of Normandy (1944), a pivotal turning point that ultimately led
to the Allied liberation of Western Europe during World War II.
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