82.67% currency remonetised so far: RBI
... But customers continue to report severe cash crunch at banks, ATMs.
The Reserve Bank on Wednesday said nearly 83 per cent of the currency has been remonetised so far and denied there was any shortage of cash in the system.
"According to our latest data, 82.67 per cent of the currency has been remonetised and in volume terms, it is 108 per cent," RBI deputy governor B P Kanungo told reporters here on Wednesday.
The government had demonetised old Rs 500 and INR 1,000 notes on November 9, junking nearly 87 per cent of the currency in circulation.
In a reply to questions in Lok Sabha, Minister of State for Finance Arjun Ram Meghwal on December 2, 2016, had said the day on which demonetisation was announced (November 8), there were 17,165 million pieces of Rs 500 notes and 6,858 million pieces of Rs 1,000 notes in circulation.
The data on the amount of demonetised notes returned back however continues to be elusive. Kanungo further said it would be wrong to assume that there is any shortage of currency in the system.
Customers across the country have been complaining of severe shortage of currency at the banks and ATMs.
Kanungo admitted that there could be shortage in some areas but said RBI is monitoring the situation on a regular basis and has made enough arrangements to replenish cash. "Yes, there could be shortage of currency in some pockets but whenever such things come to our notice, we respond immediately through various measures including inter-chest remittances.
"I won't agree to the view that there is cash shortage on a longer term basis or persistent basis at any place," he said. On shortage of cash at ATMs, the deputy governor said in an area where there are seven to eight ATMs, there is always one or two ATMs which would be dispensing cash.
Meanwhile, the Reserve Bank on Wednesday made a case for government interventions to arrest the price fall, with pulses prices under pressure due to supply glut.
Pulses prices, especially tur dal, have fallen sharply in wholesale mandis below the minimum support price (MSP) of Rs 5,050 per quintal due to a record crop this year.
In its second bi-monthly Monetary Policy Statement of 2017-18, the RBI said, "...the prices of pulses are clearly reeling under the impact of a supply glut caused by record output and imports. Policy interventions, including access to open trade, may be envisaged to arrest the slump in prices."
There has been a large-scale augmentation of pulses supply on account of expansion in acreage, procurement, buffer stocking and imports, which has caused a sharp decline in prices starting in August 2016, it said. The government has procured about 2 million tonnes of pulses for buffer stock from both domestic and global markets.
Of which, more than 1.6 million tonnes of pulses has been brought directly from local farmers. Normally, wheat and rice is procured at the MSP by the government. But, it decided to buy pulses for the first time to ensure assured returns to farmers on their pulses crop, which is grown in rainfed areas. As per Agricutlure Ministry, pulses output is estimated at a record 22.40 million tonnes in 2016-17 crop year ending June, as against 16.35 MT previous year, on good monsoon, higher MSP and procurement arrangement.
Home loans may turn cheaper as RBI cuts provisions, risk weights
In what can make new home loans cheaper, the Reserve Bank on Wednesday reduced the standard assets provisions on individual housing loans to 0.25 per cent and also lowered the risk weights on such lending.
"As a countercyclical measure, the LTV (loan to value) ratios, risk weights and standard asset provisioning rate for individual housing loans" have been reviewed from on Wednesday, the RBI said in the second bi-monthly policy statement.
The standard asset provisions, or the amount of money to be set aside for every loan made, has been lowered to 0.25 per cent from the earlier 0.40 per cent, which will help reduce the interest rates on home loans.
It also eased the risk weights for certain categories of loans, which will help banks on the capital adequacy front, and enable them to make more loans.
The risk weight for individual housing loans above INR 75 lakh has been reduced to 50 per cent from the earlier 75 per cent, while for loans between INR 30 and INR 75 lakh, a single LTV ratio slab of up to 80 per cent has been introduced with a risk weight of 35 per cent. RBI Governor Urjit Patel explained that this was a part of the Central Bank and the government attempts of 'targeted interventions' to help prop-up the sagging growth numbers.
Inflation projection lowered to 2-3.5%
RBI expects retail inflation to fall to 2-3.5 per cent in the first half of current fiscal and move up to 4.5 per cent in the second half saying that rush for farm loan waivers may have inflationary spillovers.
The abrupt and significant retreat of inflation in April from the firming trajectory that was developing in February and March has raised several issues that have to be factored into the inflation projections, it said. The earlier projection for the retail inflation in first half of the fiscal was 4.5 per cent and 5 per cent in second half.
- 22 Aug 2019 6:17 PM GMT
- 1 May 2017 6:52 PM GMT
- 8 Oct 2019 4:43 PM GMT
- 31 Aug 2019 1:38 PM GMT
- 25 Oct 2017 3:32 PM GMT
- 11 Dec 2019 1:15 PM GMT
- 11 Dec 2019 12:53 PM GMT
- 11 Dec 2019 12:30 PM GMT
- 11 Dec 2019 12:15 PM GMT
- 11 Dec 2019 12:09 PM GMT