Issue: 1189
· RBI proposes ?1 trillion
asset threshold to classify upper-layer NBFCs, simplifying regulation and
expanding coverage to large NBFCs including PSUs.
· RBI likely to maintain
surplus liquidity stance, avoiding aggressive tightening to support market
stability amid global volatility.
· ADB raises India’s FY26 GDP
forecast to 6.9%, citing strong domestic demand and improved global trade
conditions.
· India’s forex reserves jump
by $9 billion to ~$697 billion, driven mainly by rising gold reserves.
· World Bank flags downside
risks to India’s growth due to oil price volatility and Middle East tensions;
inflation pressures persist.
· IMF warns that emerging
markets face higher financial instability risk due to dependence on volatile
hedge fund flows and private credit exposure.
India to continue buying
Russian crude oil: Indian refiners will continue
to purchase Russian crude oil as the ongoing conflict in West Asia keeps the
global market on tenterhooks regarding supply certainty. Furthermore, concerns
persist over the extensive time required to rebuild the region's damaged oil
and gas infrastructure, indicating that it may take months to return to pre-war
supply levels. Sources indicate that Indian refiners intend to persist with
Russian crude purchases despite the expiration of the sanctions waiver. The
30-day US sanctions exemption, which facilitated these oil imports from Moscow,
is set to conclude on April 11.
(Business Line)
RBI absorbs Rs.2 trillion
via 7-day VRRR auction, first in 4 months: RBI absorbed Rs.2 trillion
from the banking system through a seven-day variable rate reverse repo (VRRR)
auction on Friday, its first such operation since December 5, 2025, draining a
significant portion of surplus liquidity and pushing bond yields higher. The
yield on the benchmark 10-year government bond immediately rose by 4 basis
points to 7 per cent during the day post the announcement of the VRRR auction.
The yield stabilised by the end of the trade after auction results, and settled
at 6.91 per cent against the previous close of 6.96 per cent.
(Business Standard)
US CPI surges 0.9% in
largest monthly jump since 2022 on skyrocketing gasoline prices: US inflation surged in March
by the most in nearly four years as the war with Iran sent gasoline prices
skyrocketing. The consumer price index rose
0.9% from February, according to data out Friday. From a year ago, it picked up
to 3.3%, the strongest pace since 2024. A record increase in gas prices was
responsible for nearly three-quarters of the monthly advance, the Bureau of
Labor Statistics said. Another measure that excludes food and energy costs
increased at a slower 0.2% pace.
(Business Standard)
RBI proposes Rs 1 lakh
crore asset mark for classifying upper layer NBFCs: RBI has released draft
directions aimed at reviewing scale-based regulation framework for upper layer NBFC.
Under the draft amendments, those NBFCs having asset size of Rs 1 lakh crore
and above as per the latest audited balance sheet for the financial year will
be considered upper layer NBFCs. As of March 2025-end, the Reserve Bank had
classified 15 NBFCs designated as upper layer, which included Tata Sons, which
has been classified as a core investment company.
(Business Today)
SIP inflows hit record high
in March despite market turbulence: Record inflows through
systematic investment plans last month have pushed the overall equity
investments to an eight-month high in March despite markets wobbling amidst the
West Asia war. Continued investments by retail investors saw SIP inflows rise 8
per cent to Rs.32,087 crore last month against Rs.29,845 crore logged in
February as the contributing SIP accounts increased to 9.72 crore (9.44 crore).
However, the assets under SIPs plunged 9 per cent to Rs.15.11 lakh crore (Rs.16.64
lakh crore) due to mark-to-market loss.
(Business Line)
Banks to seek RBI nod for
parallel fraud probes: Banks are seeking RBI approval
for parallel internal investigations alongside law enforcement probes into
borrower accounts. This aims to prevent discrepancies in fraud classification
due to limited information sharing. Lenders are also strengthening internal
frameworks, including early warning systems, to enhance fraud detection and
consistency. Lenders said limited
information sharing often leads to misalignment between regulatory fraud
tagging and ongoing investigations by agencies.
(Economic Times)
RBI mandates
payment of inward remittances on same business day: The Reserve Bank of India is speeding up
money transfers from abroad. Banks must now credit foreign payments to accounts
on the same business day. This change aims to make remittances faster for
everyone. Banks have six months to get ready. This move will help millions of
people receive money quicker. India is the world's top recipient of these
funds. Currently, less than 8-10% of inward
remittances in India are credited to beneficiary accounts within an hour,
compared with around 75% in the United States.
(Economic Times)
Utkarsh 2029:
RBI targets digital currency, UPI global expansion drive: RBI on Friday outlined its medium-term
strategy for April 2026 to March 2029 under the Utkarsh 2029 framework, aiming
to reinforce its position as a world-class, full-service central bank. The plan
prioritises long-term initiatives including Project Sa-Mudra to modernise
currency management, expansion of central bank digital currency (CBDC) for more
efficient cross-border payments, scaling up the unified lending interface (ULI)
to widen access to credit, and regulatory frameworks for emerging technologies
such as artificial intelligence and quantum computing in the financial sector. The
framework builds on the Utkarsh 2.0 foundations, including the
internationalisation of the rupee and the global expansion of UPI to reshape
cross-border payments. Aligned with RBI’s April-March financial year, it also
targets improved resource allocation through activity-based budgeting.
(Business Standard)
Banking system liquidity hits
four-year high: Government
spending and maturing government securities have boosted the banking system
liquidity, which has touched a four-year high, said market participants. The
system liquidity was at a surplus of Rs 4.57 lakh crore on Wednesday, the
highest in four years. It has averaged Rs 3.61 lakh crore so far in April,
compared with Rs 1.57 lakh crore in March, according to data from the Reserve
Bank of India (RBI). Liquidity was under pressure in March due to tax outflows
and RBI’s forex interventions amid the rupee weakness, triggered by the West
Asia war.
(Financial Express)
Indian banks better placed
to weather global stress but face margin squeeze, Fitch Ratings says: Indian banks are expected to remain relatively
resilient amid rising global uncertainties, though they could face pressure on
margins and liquidity if external risks persist, Fitch Ratings said in a report
on Friday. The report said Indian lenders are entering the
current phase from a position of strength, with improved asset quality and
stronger standalone credit profiles. However, higher energy prices, tighter
liquidity conditions and weakening external demand could gradually weigh on
profitability and borrower repayment capacity over time.
(Economic Times)
West Asia conflict: LPG
usage at 21-month low in March: The consumption of liquefied petroleum gas
(LPG) by India, the world’s third largest consumer, fell by almost 16 per cent
m-o-m and 13 per cent y-o-y to 2.38 million tonnes (mt) on a provisional
basis—the lowest in the last 21 months. Simultaneously, the consumption of
diesel and petrol at 8.73 mt and 3.78 mt, respectively, hit a record high last
month aided by panic buying as consumers crowded at retail outlets fearing hit
on supplies due to the conflict in West Asia, even as the government has
reiterated that there are “sufficient” supplies available. Data from the Petroleum
Planning and Analysis Cell (PPAC) show that the LPG ‘s monthly decline of 15.7
per cent in March 2026 is a record low. Prior to this, the lowest consumption
was recorded in June 2024 (2.32 mt).
(Business Line)
ADB pegs India FY27 growth
at 6.9% supported by reforms, trade deals: The Asian Development Bank (ADB) on Friday
raised India’s gross domestic product (GDP) growth forecast in FY27 by 40 basis
points (bps) to 6.9 per cent compared to its December 2025 forecast of 6.5 per
cent. It cited robust domestic reforms, rising consumption and investment, even
as it flagged risks from the escalating West Asia conflict that could keep
energy prices elevated and weigh on the outlook. “Rising consumption and
investment will drive growth in FY27, supported by favourable policies and
structural reforms, while a more benign external environment compared to FY26
will bolster exports,” its April 2026 Asian Development Outlook report added.
(Business Standard)
RBI's move to scrap
investment buffer could lift banks' capital: Banks may soon see their
capital positions improve. The central bank proposes to remove the Investment
Fluctuation Reserve. This move could help lenders recover losses on bond
investments. Accumulated reserves might transfer to core capital. This could
boost lending capacity for banks. The proposal is open for public comment. The
central bank proposal to scrap the Investment Fluctuation Reserve (IFR) will
help banks recoup the mark to market (MTM) losses they suffer on their bond
portfolios due to the recent sharp rise in yields, with the capital positions
for mainstream lenders climbing up to 20 basis points.
(Economic Times)
Sa-Dhan unveils
Sankalp 3.0 to boost governance, risk in microfinance: Sa-Dhan, an RBI-recognised
self-regulatory organisation (SRO) for the microfinance sector (MFI), on Friday
released the third edition of its sectoral guardrails — Sankalp 3.0 — aimed at
further strengthening governance standards and improving the implementation of
regulatory practices across the industry. Sankalp 3.0 places sharper emphasis
on data-led decision-making, early risk identification, stronger governance
frameworks, and customer-centric practices. The new set of guardrails comes in
the wake of an improved situation in the microfinance sector with regard to
collection efficiency and better asset quality. However, it was decided to
continue the existing guardrails for some more time so that better recovery of
the sector is possible.
(Business Standard)
RBI to push for
reporting of offshore rupee trades despite resistance: India plans to move ahead with a proposal
mandating that banks report offshore rupee derivative trades despite objections
from lenders, two sources familiar with the matter said, in an attempt to bring
transparency to a market that has amplified pressure on the currency. In
February, the Reserve Bank of India proposed that banks report rupee foreign
exchange derivative transactions undertaken globally by their related parties,
arguing it would support more efficient price discovery. The RBI wants lenders
to start sharing data on at least 70% of such derivative transactions, starting
February 2027.
(Business Standard)
QUALIFIED
OPINION
§ A
qualified opinion is a statement issued in an auditor’s report that accompanies
a company’s audited financial statements. It is an auditor’s opinion that
suggests the financial information provided by a company was limited in scope
or there was a material issue with regard to the application of regulatory
norms.
§ A
qualified opinion indicates that there was either a scope limitation, an issue
discovered in the audit of the financials that was not pervasive, or an
inadequate footnote disclosure.
§ Without
sufficient verification of transactions, an unqualified opinion may not be
given. Inadequate disclosures in the notes to the financial statements,
estimation uncertainty, or the lack of a statement of cash flows are also
grounds for a qualified opinion.
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 : 92.6492
INR
/ 1 GBP : 124.3124
INR
/ 1 EUR : 108.2760
INR
/100 JPY: 58.1600
EQUITY INDEX
Sensex:
77550.25 (+918.60)
NIFTY:
24050.60 (+275.50)
Bnk NIFTY: 55912.75 (+1091.05)
National Safe
Motherhood Day: April 11 is
primarily recognized as National Safe Motherhood Day in India, dedicated to
reducing maternal mortality. Globally, it is celebrated as World Parkinson's
Day to raise awareness of the disease, and National Pet Day to celebrate the
companionship of pets.
Historical
events: April 11 marks
major historical milestones, including the births of reformers Jyotiba Phule
and Kasturba Gandhi, the 1999 launch of India's Agni-II missile, and the 1964
split of the Communist Party of India (CPI). Globally, it is recognized for the
opening of the Adolf Eichmann trial (1961), the 1919 founding of the
International Labor Organization, and the launch of the Apollo 13 mission
(1970).
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