Tuesday, April 22, 2025
It's called dividend.
"The Reserve Bank of India (RBI) sold net $1.62 billion worth of foreign exchange in the spot market in February, according to the central bank's monthly Bulletin shared on April 22." The "RBI purchased $45.03 billion and sold $46.65 billion of foreign exchange during the period. In January, the central bank sold a net of $11.14 billion in the spot market." MC. On 1 February 2025, in her Budget speech, Finance Minister Nirmala Sitharaman "pegged dividend demands from the RBI, nationalized banks and financial institutions higher at Rs 2.56 trillion." CNBC. Naturally, since the RBI transferred a windfall of Rs 2.1 trillion to the government in 2024. TOI. The RBI is expected to pay a record Rs 2.5 trillion to the government this year. "Emkay expects the final dividend amount to be in the range of Rs 2.8 trillion to Rs 3 trillion." India Today. "Though originally privately owned, since nationalisation in 1949, the Reserve Bank is fully owned by the Government of India." rbi.org.in. At this rate what is the upper limit? Can the payout top Rs 10, Rs 20 or even Rs 100 trillion, if the Budget demands? Meanwhile, the RBI has been boosting its foreign exchange reserves. Reserves rose by $1.5 billion to $677.84 billion as of 11 April having risen by $10.8 billion to $676 billion in the week ending 4 April. ET. Having slipped to an all-time low of Rs 87.95 to one dollar on 10 February (ET), the Indian rupee (INR) strengthened to 85.159 yesterday before closing at 85.170 (Investing.com), allowing the RBI to keep buying dollars. "The Indian rupee ended weaker yesterday, in line with regional peers that fell tracking the Chinese yuan, but potential inflows into local shares helped the currency avoid further losses." "India's benchmark equity indexes, the BSE Sensex and Nifty 50, rose for the sixth session in a row, diverging from most regional indexes." Reuters. The Sensex opened at a low of 71.449 on 7 April but has rocketed to 80.142 yesterday. Investing.com. "In just six trading sessions, the Sensex has vaulted nearly 6,000 points," as "A $2 billion foreign funds gush - Rs 166 billion of FII buying in just four sessions - as India cements its position as a relative safe haven amid global uncertainty." ET. There is rising discontent throughout the world because "there is a deeper force underlying today's disarray: economic stagnation. The world is experiencing a long-term slowdown in growth rates that began in the 1970s, worsened after the 2008 global financial crisis and shows no sign of improving." "In the past G20 economies regularly grew 2 to 3 percent per year, doubling incomes every 25 to 30 years. Today, many growth rates are 0.5 to 1 percent, meaning incomes now take 70 to 100 years to double - too slow for people to feel progress in their lifetimes," wrote Aaron Benanav. Indians have insulated themselves with gold. "As gold prices soared to touch Rs 100,000 per 10 grams at the retail level.., Uday Kotak took to social media to celebrate a familiar Indian investor: the homemaker." "Indian women collectively own a staggering 24,000 to 25,000 tonnes of gold," more than "the official reserves of the top five countries combined." ET. The RBI may run out of cash but our women don't depend on it. They have something solid. Yellow in color.
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