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RBI cuts its lending rate to banks by 0.35 per cent, GDP growth from 7 per cent to 6.9 percent 

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[vc_row][vc_column][vc_column_text]The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) headed by Governor Shaktikanta Das today (Wednesday, Aug 7) cut the key interest rate for the fourth time in a row, reducing the policy repo rate by 35 basis points – or 0.35 per cent, from 5.75 per cent to 5.40 per cent – citing economic slowdown and NBFC liquidity crisis.

In the earlier three policies, it has reduced repo rate by 25 basis points each.

The repo rate is the key interest rate at which it lends short-term funds to commercial banks. One basis point is one-hundredth of a percentage point.

With the current rate cut, RBI has reduced 110 bps so far this year. The move, bringing down the repo rate to the lowest in over nine years is intended to spur economic growth. The repo rate cut is expected to bring down equated monthly instalments (EMI) for home and other loan borrowers.

With today’s rate cut the Reserve Bank of India has become the most dovish Asian central bank, according to analysts.

Almost 80 per cent of 66 economists surveyed by news agency Reuters had expected the RBI to cut its benchmark repo rate by 25 bps. Three respondents predicted a 50 bps cut and the remaining 10 forecast the rate would be left unchanged.

The decision of the Monetary Policy Committee to cut repo rate was unanimous, with four members voting to cut rate by 35 basis points and the rest voting for a 25-basis-points reduction.

The central bank lowered the reverse repo rate, at which it borrows money from commercial lenders, to 5.15% from 5.50%. The MPC has maintained its policy stance as accommodative meaning that it is in favour of lowering the interest rates.

The RBI also cut gross domestic product (GDP) growth target for current financial year to 6.9 per cent from 7 per cent in the June policy. 

The range of GDP growth is projected at 5.8-6.6 per cent for first half of 2019-20, and 7.3-7.5 per cent for second half “with risks tilted to the downside”, the RBI said in its third bi-monthly policy statement of the current financial year.

On the inflation front, the RBI said it remained within the targeted band. It projected consumer inflation at 3.1 per cent in the second quarter, and 3.5-3.7 per cent in the second half of the current financial year, both below its medium-term goal of 4 per cent.

The last time the RBI made so many back-to-back cuts was after the global financial crisis over a decade ago, when most major central banks were desperate to revive economic growth.

The RBI noted that global economic activity has slowed down since the previous monetary policy meeting in June, owing to trade tensions among leading economies. It also noted that economic activity remained weakened in major emerging market economies. China, Russia and Brazil, among others, saw subdued activity, the RBI said.[/vc_column_text][/vc_column][/vc_row]

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Vistara and Air India airlines to merge by March 2024

The latest notification states that SIA is also investing Rs 20,585 million in Air India as part of the transaction.

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Vistara and Air India airlines to merge

Tata Sons and Singapore Airlines (SIA) have agreed to merge Air India and Vistara airlines by March 2024. The latest notification states that SIA is also investing Rs 20,585 million in Air India as part of the transaction, giving SIA a 25.1 percent stake in the Air India group.

Currently, Tata Group holds 51 percent of the shares in Vistara, and Singapore Airlines has the remaining 49 percent. According to the release, SIA and Tata have also agreed to take part in future capital investments that may be necessary to finance the expansion and operations of the larger Air India in the fiscal years 2022–2023 and 2023–2024.

Tata Sons chairman N Chandrasekaran said that the merger of Vistara and Air India is an important milestone in their journey to make Air India a truly world-class airline. He said they are transforming Air India, with the aim of providing a great customer experience, every time, for every customer.

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He further said that as part of the transformation, Air India is focusing on growing both its network and fleet, revamping its customer proposition, and enhancing safety, reliability, and on-time performance. He stated that both Tata Sons and Singapore Airlines are excited about the opportunity of creating a strong Air India which would offer both full-service and low-cost services across domestic and international routes. He also thanked Singapore Airlines for their continued partnership.

SAI chief executive officer Goh Choon Phong said the merger provides an opportunity to deepen the company’s relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market.

SAI chief executive officer Goh Choon Phong said Tata Sons is one of the most established and respected names in India. SIA’s collaboration to set up Vistara in 2013 resulted in a market-leading full-service carrier, which has won many global accolades in a short time. He said with this merger, SIA has an opportunity to deepen its relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market. He further said that they will work together to support Air India’s transformation programme, unlock its significant potential, and restore it to its position as a leading airline on the global stage.

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Nykaa CFO Arvind Agarwal resigns

Arvind Agarwal earlier worked with Amazon and joined Nykaa in July 2020.

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Arvind Agarwal

Nykaa chief financial officer Arvind Agarwal resigned from his position on Tuesday. The fashion and beauty e-commerce platform announced his resignation.

In a BSE filing, Nykaa informed that Agarwal will be leaving the Company, effective close of business hours on November 25, 2022, to pursue other opportunities in the digital economy and start-up space.

Nykaa’s founder Falguni Nayar hailed Agarwal for the crucial role he played in the company’s emergence as a listed and profitable start-up. Nayar said the company is conscious of Agarwal’s personal dreams and wishes him all the luck.

Upon his resignation, Agarwal said his journey in Nykaa has been incredible so far and all his learning and experiences have set them up for pursuing different personal growth opportunities in the field. He further wished Nykaa good luck for the growth path ahead.

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Arvind Agarwal earlier worked with Amazon and joined Nykaa in July 2020. He was among the key managerial personnel and handled the initial public offer of the firm. Before Amazon, Agarwal worked with Vodafone India for more than 5 years. He had also worked with YOU Telecom, Adani Port, and Tata Teleservices.

Reports said Agarwal paid a total remuneration of Rs 19.58 million during the financial year 2021.

Apart from Nykaa, food delivery application Zomato also saw the resignation of its co-founder Mohit Gupta after 5 years of association with the company.

Gupta, in a message, stated that he decided to move on from Zomato to seek other unknown adventures. He also hailed Deepinder Goyal as he has become a more mature and confident leader who is capable of leading the business into a bright future.

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Jeff Bezos warns of recession, advises people to refrain from buying TV, fridge, cars during holiday season

The former CEO of Amazon also advised small business owners to put off purchasing new equipment in favour of increasing their cash reserves.

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Jeff Bezos warns of recession, advises people to refrain from buying TV, fridge, cars during holiday season

In light of the possibility of a global recession, Amazon founder Jeff Bezos advised consumers to refrain from making significant purchases during the holiday season. Given the state of the economy, he urged people to keep their money safe and refrain from irrational spending in the upcoming months.

The business tycoon said American families should avoid purchasing big-ticket items such as new cars, TVs, automobiles, and refrigerators as the US is staring at a recession. He said American household debt has reached a record high of $16.5 trillion, and people are switching to credit to get their ends meet.

The former CEO of Amazon also advised small business owners to put off purchasing new equipment in favour of increasing their cash reserves.

Bezos said Take some risk off the table, adding, Keep some dry powder on hand. Just a little bit of risk reduction could make the difference for that small business if we do get into even more serious economic problems. You’ve got to play the probabilities a little bit.

He said things are slowing down and many sectors of the economy are seeing layoffs, and this is why you should hold onto your money.

Meanwhile, the founder of Amazon stated in the same interview that he will contribute the majority of his $124 billion income to charitable organizations in order to combat climate change and to help those who can bring mankind together in the face of escalating social and political conflicts.

Bezos did not say how much of his money he intended to donate. But he said, Yeah, I do, in response to the question of whether he will donate a significant percentage of his wealth to charity.

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