Issue: 1356
· American Express to cut 5% of
headcount globally as cost pressures mount.
· Parsi bodies back Tata
Trusts, urge PM Modi to protect group’s long-term governance model.
· Crude oil futures spike over
3% to Rs 9,783/barrel; Brent tops $117.
· NYSE options exchange trading
halted by ‘technical issue’.
· Jio IPO breaks records with
1.34 crore applications, draws Rs 7 lakh crore in bids.
· IDBI Bank employees’ service
conditions will remain unchanged after sale, says DIPAM secretary.
RBI's net dollar purchases
hit record $43.26 billion in August: Bulletin: The Reserve Bank of India (RBI) made net dollar
purchases of a record $43.26 billion in August, more than doubling its net
buying of $18.65 billion in July, according to data released in the central
bank’s monthly bulletin. The sharp increase coincided with the return of
dollars mobilised under the RBI’s concessional swap facility for FCNR(B)
deposits, external commercial borrowings and overseas foreign currency
borrowings through the swap window. The central bank had advanced the
facility’s closure to August 31 from September 30 after banks had mobilised
$52.3 billion by August 14. The RBI purchased $74.47 billion in the spot market
during August and sold $31.21 billion, taking its net purchases to $43.26
billion.
(Moneycontrol)
India-US bond yield gap
tops 250 bps as G-Sec yield hits 7.48%; FPI inflows uncertain: India’s benchmark 10-year
government bond yield rose to 7.48% on Friday morning, pushing the spread over
the US 10-year Treasury yield to around 251 basis points, its highest level in
four months. With the US 10-year Treasury yielding about 4.96%-4.97%, the
India-US yield gap has moved above the 250 basis points (bps) mark, a level
that bond market participants believe enhances the relative attractiveness of
Indian debt but may not be enough on its own to attract sustained foreign
portfolio inflows. In June 2026, the differential
was around 250 bps, with the US 10-year Treasury hovering around 4.5% while the
Indian 10-year G-Sec was trading in the 6.90%-7.00% range. The India-US 10-year
spread has fluctuated widely over the years. The differential touched much
wider levels during 2020-21, when it exceeded 500 basis points, before
narrowing sharply. More recently, the differential had compressed to nearly 160
bps in May 2025 before widening again.
(Business Line)
Statistics Min proposes
changes in PLFS to include unpaid work, better capture digital platform workers:
India’s
labour data will undergo a change from January next year, with data on unpaid
activities and digital platform workers to be part of the survey report. Unpaid
activities comprise own-use production of goods, unpaid household and
caregiving activities, volunteer work and unpaid trainee work. These are part
of changes proposed in Periodic Labour Force Survey (PLFS). Accordingly, it has
floated a concept note, and invited suggestions before finalising the
modification, Statistics Ministry said in a statement.
(Business Line)
23 days after new RBI forex
rules, individual service exporters still await clarity, banks lack SOPs: Twenty-three days after the
Reserve Bank of India’s Foreign Exchange Management Regulations went live,
individual service exporters continue to face uncertainty over its compliance. In
the absence of official, written clarifications by RBI on the applicability of
the new EDF regime for individuals receiving foreign remittance towards
services rendered, different AD banks have taken different approaches and
majority are also yet to put out their SOPs as mandated by the regulator.
(Business Line)
Banks see Rs.5.19 lakh
crore deposit outflow, credit shrinks Rs.2.52 lakh crore: The banking sector saw a Rs
5.19 lakh crore withdrawal of deposits on net basis in the fortnight ending
October 15 while credit outstanding too contracted by Rs 2.52 lakh crore, Reserve
Bank of India data showed. Accordingly, the credit growth slowed to 18.2% from
the 19.4% in the preceding fortnight while deposit growth recorded at 16.7%
against 17.8%. Outstanding deposits of all banks taken together stood at Rs
278.76 lakh crore while outstanding credit at Rs 227.43 lakh crore. The
credit-deposit stood at 81.59% at the end of the reporting fortnight.
(Economic Times)
RBI updates leverage ratio
framework for banks: Domestic systemically
important banks (D-SIBs) and other domestic commercial banks must maintain a
minimum leverage ratio of 4 per cent and 3.5 per cent, respectively, as per
RBI’s updated leverage ratio framework. The aforementioned reserve norms,
prescribed in RBI (Commercial Banks – Prudential Norms on Capital Adequacy)
Eleventh Amendment Directions, 2026, are aimed at ensuring alignment with the
latest leverage ratio framework (‘leverage ratio 2017 standard’) issued by the
Basel Committee on Banking Supervision.. They will take effect from April 01,
2027.
(Business Line)
Bank of India’s Q2FY27 net profit up 25% at Rs.3,202 crore: Bank of India’s second quarter
(Q2FY27) standalone net profit rose 25 per cent year-on-year (y-o-y) to Rs.3,202
crore, with the bottomline being supported by a healthy increase in net
interest income and other income even as there was a significant jump in
non-performing asset (NPA) provisioning. Global deposits grew at faster clip
(of 21.60 per cent y-o-y) as compared to global advances (of 20.58 per cent). Gross
NPAs position improved to 1,60 per cent of gross advances as at September-end
2026 against 2.54 per cent as at September-end 2025. Net NPAs position too
improved to 0.42 per cent of net advances against 0.65 per cent.
(Business Line)
Digital upgrade of
financial sector to onboard NRIs, FPIs: The Financial Stability and
Development Council (FSDC) on Friday reviewed India’s macro-financial stability
amid rising geopolitical uncertainties and deliberated on measures to
strengthen domestic investment, enhance capital flows and deepen financial
sector reforms. The Council recognised the need for proactive efforts to
mitigate potential risks to financial stability while adopting adequate
safeguards for the financial system’s resilience. According to an official
statement, the members also decided to strengthen inter-regulatory coordination
for a broader financial sector. The council that comprises all finacial sector
regulators also emphasised simplifying and digitising know-your-customer (KYC)
processes and enabling digital onboarding for non-resident Indians (NRIs) and
foreign portfolio investors (FPIs).
(Financial Express)
Jio Platforms to join Meta,
Alibaba, SpaceX in $100 billion-plus IPO valuation club: Jio Platforms is poised to become the fourth
company globally, after Meta, Alibaba and SpaceX, to join the select group of
founder-led businesses achieving an equity valuation of more than $100 billion
at the time of an initial public offering (IPO). The Rs 30,213 crore IPO witnessed record investor
interest, bucking a selloff in Indian equities to emerge as the country's most
sought-after share sale in terms of the value of bids received. The IPO attracted total
bids of around Rs 7 lakh crore, including anchor investor demand, and received
a record 1.34 crore applications, according to exchange data. The issue was
fully subscribed within 100 minutes of opening, making it India's
fastest-subscribed mega IPO.
(Moneycontrol)
India pvt sector growth at
4-month high in Oct, PMI shows: India’s private sector activity remained
robust in October, particularly the services sector, with strong demand while
inflation pressures eased, S&P Global said on Friday. The HSBC Flash India
Composite Purchasing Managers’ Index (PMI) rose to a four-month high of 56.7 in
October from 55.9 in September. A PMI reading of more than 50 denotes expansion
in activity from the previous month, while a print below 50 indicates
contraction. The uptick in activity was led by the services sector, with the
flash services PMI rising to a four-month high of 56.2 in October from 55.2 a
month ago. The flash manufacturing PMI, meanwhile, fell to 54.9 in October from
a seven-month high of 55.1 in September.
(Financial Express)
NBFCs lose ground despite
stronger profitability, better asset quality: RBI Study: India’s non-banking financial
companies (NBFCs) continued to expand their loan books and improve
profitability in 2025, but their share in the overall financial system has slipped
since the Covid pandemic, reflecting faster growth in other segments such as
mutual funds, pension funds and banks, according to the RBI’s review of the
sector. The RBI study showed that NBFCs, including housing finance companies
(HFCs), accounted for 12.7 per cent of total financial sector assets at
end-March 2025, down from 13.9 per cent at end-March 2020. While NBFCs remain
the second-largest segment of India’s financial system after scheduled
commercial banks, their relative share has declined over the past five years.
At the same time, banks still accounted for 52.3 per cent of financial sector
assets at end-March 2025, compared with 58.2 per cent in March 2020.
(Business Line)
RBI tweaks operational risk
capital framework for banks: The Reserve Bank of India on Friday amended
its operational risk capital framework for commercial banks ahead of its
implementation from April 1, 2027. The central bank issued detailed guidance on
the computation of Operational Risk Capital (ORC), including an indicative
mapping of Business Indicator (BI) items to balance sheet and profit-and-loss
account schedules. The central bank also clarified that operational risk losses
used for calculating the Internal Loss Multiplier (ILM) will be considered net
of recoveries. Further, banks with at least five years of high-quality loss
data can use such data for computing the loss component if 10-year data is
unavailable.
(Business Line)
SEBI eases call recording
rules for research analysts: SEBI has relaxed the mandatory requirement for
research analysts (RA) to maintain call recordings of their interactions with
institutional investors to reduce compliance burden and improve ease of doing
business. Research analysts and entities will no longer be mandatorily required
to maintain call recordings of interactions with institutional investors.
However, they will continue to be required to maintain records of their
interactions with all clients, including prospective clients, through means
such as signed physical records, emails, SMS messages, call recordings or any
other legally verifiable method. The records are required to be maintained for five
years. In cases where a dispute has been raised, the records will have to be
preserved until its resolution. They also need to be retained if SEBI directs
that specific records be preserved. The regulator clarified that call
recordings are not required when client interactions take place through
channels such as email, where a digital footprint is available.
(Business Line)
Sebi mulls automatic
approval for investments, activities by exchanges: Markets regulator Sebi has proposed allowing
stock and depositories to deploy funds and undertake activities related to
their core functions without its prior approval, a move aimed at reducing
regulatory burden and improving ease of doing business. In its consultation
paper, the Securities and Exchange Board of India (Sebi) has proposed an
automatic approval route for activities related or incidental to the core
functions of exchanges and depositories, subject to specified financial limits
and governance safeguards. The proposal covers market infrastructure
institutions (MIIs), which currently require prior Sebi approval for activities
involving fund deployment or otherwise, except for treasury investments made
under a board-approved investment policy.
(Business Standard)
STUBBORN
INFLATION
·
Stubborn inflation, often referred to as sticky
inflation, occurs when the prices of goods and services remain high and resist
downward market pressures even after central banks implement aggressive
monetary tightening, such as raising interest rates.
·
Unlike transitory inflation, which spikes and
recedes quickly due to temporary supply chain shocks, stubborn inflation
becomes deeply embedded in the economy—particularly within the services sector,
rent, and wages. This persistence is often driven by a self-fulfilling cycle
where workers demand higher wages to keep up with the rising cost of living,
forcing businesses to raise prices further to maintain their profit margins.
Because it is highly resistant to standard economic fixes, stubborn inflation
presents a severe challenge for policymakers, frequently forcing central banks
to keep interest rates elevated for a prolonged period, which risks slowing
down economic growth or triggering a recession.
RBI KEY RATES
Repo
Rate: 5.50%
SDF:
5.25%
MSF
/Bank Rate: 5.75%
CRR:
3.00%
SLR:
18.00%
FOREX RATES (RBI REF. RATE)
INR
/ 1 USD : 94.9432
INR
/ 1 GBP : 127.1286
INR
/ 1 EUR : 106.4547
INR
/100 JPY: 60.4900
EQUITY INDEX
Sensex:
73123.83 (-125.56)
NIFTY:
22600.00 (-87.65)
Bnk NIFTY: 54287.35 (-638.35)
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