General Affairs
Ushering another banking revolution in the country, the Reserve Bank of India (RBI) on 16 September 2015 accorded “in-principal” approval for 10 small finance banks. These banks will focus on small geographies for operations but with a strong capital base. Which 10 entities were selected for these small banks?
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1) Au Financiers, 2) Capital Local Area Bank, 3) Disha Microfin, 4) Equitas Holdings, 5) ESAF Microfinance, 6) Janalakshmi Financial Services, 7) RGVN (North East) Microfinance, 8) Suryoday Micro Finance, 9) Ujjivan Financial Services and 10) Utkarsh Micro Finance
The selection of these small banks was on the basis of the recommendations from three different committees, backed by a detailed case study for each applicant, including that by an External Advisory Committee chaired by former deputy governor Usha Thorat. An important factor was proposed to reach into unbanked areas and underserved sections of the population. Draft guidelines for licensing of small finance banks were released for public comments on 17 July 2014 and based on the comments, the final norms for licensing of small finance banks were issued on 27 November. Earlier, in 2009 a Committee on Financial Sector Reforms under Raghuram Rajan, now the RBI governor, had examined the relevance of small banks in the Indian context.
1) Au Financiers, 2) Capital Local Area Bank, 3) Disha Microfin, 4) Equitas Holdings, 5) ESAF Microfinance, 6) Janalakshmi Financial Services, 7) RGVN (North East) Microfinance, 8) Suryoday Micro Finance, 9) Ujjivan Financial Services and 10) Utkarsh Micro Finance
The selection of these small banks was on the basis of the recommendations from three different committees, backed by a detailed case study for each applicant, including that by an External Advisory Committee chaired by former deputy governor Usha Thorat. An important factor was proposed to reach into unbanked areas and underserved sections of the population. Draft guidelines for licensing of small finance banks were released for public comments on 17 July 2014 and based on the comments, the final norms for licensing of small finance banks were issued on 27 November. Earlier, in 2009 a Committee on Financial Sector Reforms under Raghuram Rajan, now the RBI governor, had examined the relevance of small banks in the Indian context.
Nepal’s parliament overwhelmingly approved country’s new constitution on 16 September 2015. The new constitution was passed by 507 votes to 25 in the 601-member Constituent Assembly. This is overall ………..constitution enacted in the country
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Fifth
Nepal previously had four constitutions enacted respectively in 1959, 1962, 1990 and 1999. It is worth mentioning that Nepal was governed by an interim constitution after the monarchy was abolished in 2008. The new constitution will see Nepal divided into seven provinces but it angered minority ethnic groups who fear discrimination and sparked protests in which 40 died. Hindu groups have also been demonstrating, demanding that Nepal be declared a Hindu state – it became a secular republic after the monarchy was scrapped. The new constitution will come into effect from 20 September 2015.
Fifth
Nepal previously had four constitutions enacted respectively in 1959, 1962, 1990 and 1999. It is worth mentioning that Nepal was governed by an interim constitution after the monarchy was abolished in 2008. The new constitution will see Nepal divided into seven provinces but it angered minority ethnic groups who fear discrimination and sparked protests in which 40 died. Hindu groups have also been demonstrating, demanding that Nepal be declared a Hindu state – it became a secular republic after the monarchy was scrapped. The new constitution will come into effect from 20 September 2015.
Which city would host the XIX Asian Games 2022 as announced on 16 September 2015?
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Hangzhou (China)
Hangzhou, the capital of China’s Zhejiang Province, was announced as the host city of the 2022 Asian Games. The announcement was made at the Olympic Council of Asia (OCA’s) 34th Congress held at Ashkhabad (Turkmenistan). It was the only candidate city for these games. Hangzhou, the home base of Chinese Internet giant Alibaba, will thus be the third Chinese city to host the Asian regional games, following Beijing in 1990 and Guangzhou in 2010. South Korea’s Incheon held the last Asian Games in 2014, while Indonesia will play host in 2018.
Hangzhou (China)
Hangzhou, the capital of China’s Zhejiang Province, was announced as the host city of the 2022 Asian Games. The announcement was made at the Olympic Council of Asia (OCA’s) 34th Congress held at Ashkhabad (Turkmenistan). It was the only candidate city for these games. Hangzhou, the home base of Chinese Internet giant Alibaba, will thus be the third Chinese city to host the Asian regional games, following Beijing in 1990 and Guangzhou in 2010. South Korea’s Incheon held the last Asian Games in 2014, while Indonesia will play host in 2018.
Which West African country faced military coup with the military officers overthrowing the government on 17 September 2015?
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Burkina Faso
Burkina Faso was plunged into chaos as presidential guards seized power in a coup, with reports of more than 10 deaths amid protests in the capital, Ouagadougou. Gen. Gilbert Diendéré took control of the country, according to a military spokesman. General Diendéré is a close ally of the former president, Blaise Compaoré, who was in power for 27 years until last fall. The crisis began in the evening of 16 September, when members of the Presidential Security Regiment, known by its French initials, R.S.P., stormed a cabinet meeting and seized the interim president, Michel Kafando and Prime Minister Isaac Zida. Their transitional authority was due to hand power to a new government after elections on 11 October 2015. Burkina Faso is one of the world’s poorest countries. It was a former French colony and gained independence in 1960.
Burkina Faso
Burkina Faso was plunged into chaos as presidential guards seized power in a coup, with reports of more than 10 deaths amid protests in the capital, Ouagadougou. Gen. Gilbert Diendéré took control of the country, according to a military spokesman. General Diendéré is a close ally of the former president, Blaise Compaoré, who was in power for 27 years until last fall. The crisis began in the evening of 16 September, when members of the Presidential Security Regiment, known by its French initials, R.S.P., stormed a cabinet meeting and seized the interim president, Michel Kafando and Prime Minister Isaac Zida. Their transitional authority was due to hand power to a new government after elections on 11 October 2015. Burkina Faso is one of the world’s poorest countries. It was a former French colony and gained independence in 1960.What is the name of the UPA-appointed Director of Nehru Memorial Museum and Library (NMML), who recently resigned controversially from the post and the resignation was accepted on 17 September 2015 by the Executive Council?
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Mahesh Rangarajan
Rangarajan’s resignation came more than a week after Culture Minister Mahesh Sharma criticized his appointment illegal and unethical. Sharma had raked up the appointment of Rangarajan by the outgoing Prime Minister Manmohan Singh just two days before the Lok Sabha election results were declared last year. The resignation came in the midst of the Congress party accusing the government of being engaged in actions to belittle the legacy of Jawaharlal Nehru by going for a complete revamp of the cultural institutions.
Mahesh Rangarajan
Rangarajan’s resignation came more than a week after Culture Minister Mahesh Sharma criticized his appointment illegal and unethical. Sharma had raked up the appointment of Rangarajan by the outgoing Prime Minister Manmohan Singh just two days before the Lok Sabha election results were declared last year. The resignation came in the midst of the Congress party accusing the government of being engaged in actions to belittle the legacy of Jawaharlal Nehru by going for a complete revamp of the cultural institutions.Business Affairs
Rupee strengthens 32 paise against dollar to 66.14
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The rupee strengthened by 32 paise to 66.14 against the US dollar in early trade on Friday at the Interbank Foreign Exchange after the American currency tumbled against major world currencies as the Federal Reserve decided again not to increase interest rates.
Besides, increased selling of dollar by exporters and banks and a higher opening in the domestic equity market supported the rupee, dealers said. The rupee had slipped 10 paise to end at 66.46 in the previous session on Wednesday on persistent demand for the American currency from banks and importers on the back of a higher greenback in overseas markets.
Forex market was closed on Thursday on account of Ganesh Chaturthi.
Meanwhile, the benchmark BSE Sensex surged 315.96 points, or 1.22 per cent, to trade at 26,279.93.
The rupee strengthened by 32 paise to 66.14 against the US dollar in early trade on Friday at the Interbank Foreign Exchange after the American currency tumbled against major world currencies as the Federal Reserve decided again not to increase interest rates.
Besides, increased selling of dollar by exporters and banks and a higher opening in the domestic equity market supported the rupee, dealers said. The rupee had slipped 10 paise to end at 66.46 in the previous session on Wednesday on persistent demand for the American currency from banks and importers on the back of a higher greenback in overseas markets.
Forex market was closed on Thursday on account of Ganesh Chaturthi.
Meanwhile, the benchmark BSE Sensex surged 315.96 points, or 1.22 per cent, to trade at 26,279.93.
Key messages from RBI's nod for small finance banks
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Roadmap for MFIs: There seems to a clear roadmap for themicrofinance institutions (MFIs) to graduate. Eight out of the 10 applicants to have been granted the in-principle nod by the Reserve Bank of India (RBI) for small finance banksare MFIs. Other than Au Financiers (India) Ltd., Jaipur and Capital Local Area Bank Ltd., Jalandhar, all the others are MFIs. These are: Disha Microfin Private Ltd., Ahmedabad; Equitas Holdings P Limited, Chennai; ESAF Microfinance and Investments Private Ltd., Chennai (though it is Kerala where it is strong); Janalakshmi Financial Services Private Limited, Bangalore; RGVN (North East) Microfinance Limited, Guwahati; Suryoday Micro Finance Private Ltd., Navi Mumbai; Ujjivan Financial Services Private Ltd., Bangalore; and Utkarsh Micro Finance Private Ltd., Varanasi.
It's functional imperative, not regional imperative, that matters: Here is where there is a major issue with the licences. The whole point about small finance banks was financial inclusion, but none of the financially excluded geographies figure prominently. All the licences have gone to players who are from the highly served regions of South, West and North, barring RGVN from Guwahati and Utkarsh from Varanasi (the central region). Perhaps, out of the 70 total applicants (two out of the 72 withdrew later), many may not have been from the excluded regions. Plus, perhaps the emphasis is more on the functional imperative of deepening the engagement on financial inclusion in the chosen geographies. Fastest growing MFIs get the nod: Fastest may not mean reckless. Some of the MFIs like Janalakshmi Financial Services, Ujjivan Financial Services, Utlkash Microfinance that have been among the fastest growing with some at 100 per cent have got the licence. It will need to be seen how they can sustain this growth as small finance banks. In fact, one critic, in a lighter vein, pointed out that "if someone is growing too fast, put them into the banking system and it will slow them down". Others argue that being a bank is bad news for an NBFC, purely from a profitability perspective. But then, as some would say "bank, like the airline industry, is an ego game".
Nationally spread MFI is not the same as nationally spread bank: Much depends on how this pans out but MFIs have grown fast so far because they could borrow from banks. As small finance banks, they cannot borrow from other banks and will have to lend from the deposits they generate. Look at the large advertisements and billboards put up nationally by Bandhan Bank seeking new depositors. As banks, they need to make a huge transition: make provisions for CRR (Cash Reserve Ratio), and SLR (Statutory Liquidity Ratio), and put money aside for agriculture loans. Today, as MFIs, with their weekly micro loan lending, they do rural but not necessarily agri lending. They will need to do that, too.
Investment thesis validation for early investors: Two individuals, Vineet Rai and S. Viswanatha Prasad, would be the happiest men. Five of the 10 entities granted approval for small finance banks are their portfolio companies. Vineet Rai is the Founder and Managing Director of Aavishkaar Venture Management Services, which has Equitas, Utkarsh and Suryoday as the portfolio companies. And Prasad is the Managing Director of Caspian Impact Investment Adviser with Equitas, Ujjivan and Janalakshmi as the portfolio companies. Rai, who first invested Rs 6 crore in Equitas around January 2009, after which Equitas began building its portfolio, feels validated since the companies have emerged among the top 10 and "is an endorsement of the incredible work done by the promoters of these entities". Going forward, he says, "our job is to help and assist the companies move in the right direction and our role going forward will be to do what it will take to make the banks successful and will therefore play any role that the promoter expects us to play." Surely, with the profile of these portfolio companies raised significantly, even an exit would be a decent one for these investors.
Next 18 months crucial: Within the next 18 months, these entities will have to make the transition and get the required domestic investors for as the RBI says: "The 'in-principle' approval granted will be valid for 18 months to enable the applicants to comply with the requirements under the Guidelines and fulfil other conditions as may be stipulated by the RBI. On being satisfied that the applicants have complied with the requisite conditions laid down by it as part of 'in-principle' approval, the RBI would consider granting them a licence for commencement of banking business under Section 22(1) of the Banking Regulation Act, 1949. Until a regular licence is issued, the applicants cannot undertake any banking business."
Roadmap for MFIs: There seems to a clear roadmap for themicrofinance institutions (MFIs) to graduate. Eight out of the 10 applicants to have been granted the in-principle nod by the Reserve Bank of India (RBI) for small finance banksare MFIs. Other than Au Financiers (India) Ltd., Jaipur and Capital Local Area Bank Ltd., Jalandhar, all the others are MFIs. These are: Disha Microfin Private Ltd., Ahmedabad; Equitas Holdings P Limited, Chennai; ESAF Microfinance and Investments Private Ltd., Chennai (though it is Kerala where it is strong); Janalakshmi Financial Services Private Limited, Bangalore; RGVN (North East) Microfinance Limited, Guwahati; Suryoday Micro Finance Private Ltd., Navi Mumbai; Ujjivan Financial Services Private Ltd., Bangalore; and Utkarsh Micro Finance Private Ltd., Varanasi.
It's functional imperative, not regional imperative, that matters: Here is where there is a major issue with the licences. The whole point about small finance banks was financial inclusion, but none of the financially excluded geographies figure prominently. All the licences have gone to players who are from the highly served regions of South, West and North, barring RGVN from Guwahati and Utkarsh from Varanasi (the central region). Perhaps, out of the 70 total applicants (two out of the 72 withdrew later), many may not have been from the excluded regions. Plus, perhaps the emphasis is more on the functional imperative of deepening the engagement on financial inclusion in the chosen geographies. Fastest growing MFIs get the nod: Fastest may not mean reckless. Some of the MFIs like Janalakshmi Financial Services, Ujjivan Financial Services, Utlkash Microfinance that have been among the fastest growing with some at 100 per cent have got the licence. It will need to be seen how they can sustain this growth as small finance banks. In fact, one critic, in a lighter vein, pointed out that "if someone is growing too fast, put them into the banking system and it will slow them down". Others argue that being a bank is bad news for an NBFC, purely from a profitability perspective. But then, as some would say "bank, like the airline industry, is an ego game".
Nationally spread MFI is not the same as nationally spread bank: Much depends on how this pans out but MFIs have grown fast so far because they could borrow from banks. As small finance banks, they cannot borrow from other banks and will have to lend from the deposits they generate. Look at the large advertisements and billboards put up nationally by Bandhan Bank seeking new depositors. As banks, they need to make a huge transition: make provisions for CRR (Cash Reserve Ratio), and SLR (Statutory Liquidity Ratio), and put money aside for agriculture loans. Today, as MFIs, with their weekly micro loan lending, they do rural but not necessarily agri lending. They will need to do that, too.
Investment thesis validation for early investors: Two individuals, Vineet Rai and S. Viswanatha Prasad, would be the happiest men. Five of the 10 entities granted approval for small finance banks are their portfolio companies. Vineet Rai is the Founder and Managing Director of Aavishkaar Venture Management Services, which has Equitas, Utkarsh and Suryoday as the portfolio companies. And Prasad is the Managing Director of Caspian Impact Investment Adviser with Equitas, Ujjivan and Janalakshmi as the portfolio companies. Rai, who first invested Rs 6 crore in Equitas around January 2009, after which Equitas began building its portfolio, feels validated since the companies have emerged among the top 10 and "is an endorsement of the incredible work done by the promoters of these entities". Going forward, he says, "our job is to help and assist the companies move in the right direction and our role going forward will be to do what it will take to make the banks successful and will therefore play any role that the promoter expects us to play." Surely, with the profile of these portfolio companies raised significantly, even an exit would be a decent one for these investors.
Next 18 months crucial: Within the next 18 months, these entities will have to make the transition and get the required domestic investors for as the RBI says: "The 'in-principle' approval granted will be valid for 18 months to enable the applicants to comply with the requirements under the Guidelines and fulfil other conditions as may be stipulated by the RBI. On being satisfied that the applicants have complied with the requisite conditions laid down by it as part of 'in-principle' approval, the RBI would consider granting them a licence for commencement of banking business under Section 22(1) of the Banking Regulation Act, 1949. Until a regular licence is issued, the applicants cannot undertake any banking business."
Stocks to focus: Tata Steel, Mindtree and more
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With the market expected to take cues from the US Federal Reserve keeping the interest rates unchanged, here are the five stocks expected to be in focus today:
- Power Grid Corporation of India: State-run utility Power Grid on Thursday said its shareholders have approved a proposal to raise up to Rs 14,000 crore through issuance of bonds from domestic and external sources in 2016-17.
- Tata Steel: Tata Steel has informed BSE that the company based on the review of its portfolio, is proposing to sell equity shares worth up to Rs 243.87 crore of Tata Motors Limited to institutional investors over the stock exchange. The shares are being offered in an indicative range of Rs 324.50 to Rs 338.05 each for a value not exceeding Rs. 1,250 crore.
- Mindtree: The company said that Dubai Aviation Corp Flydubai had selected it as its technology partner.
- Granules India: Drug maker Granules India has received approval from the US health regulator to market generic Ibuprofen tablets -- used to treat fever, pain or inflammation -- in the American market. The Hyderabad-based company said US Food and Drug Administration (USFDA) has approved its abbreviated new drug applications (ANDA) for Ibuprofen tablets in strengths of 400 mg, 600 mg, and 800 mg.
- DLF:Realty major DLF on Wednesday said its shopping mall in Noida, touted as one of the biggest in the country and built at an investment of Rs 1,100 crore, will be opened in November. DLF is expecting Rs 200 crore rental income per year from this mall, which has a leasable area of about 2 million sq ft.
With the market expected to take cues from the US Federal Reserve keeping the interest rates unchanged, here are the five stocks expected to be in focus today: - Power Grid Corporation of India: State-run utility Power Grid on Thursday said its shareholders have approved a proposal to raise up to Rs 14,000 crore through issuance of bonds from domestic and external sources in 2016-17.
- Tata Steel: Tata Steel has informed BSE that the company based on the review of its portfolio, is proposing to sell equity shares worth up to Rs 243.87 crore of Tata Motors Limited to institutional investors over the stock exchange. The shares are being offered in an indicative range of Rs 324.50 to Rs 338.05 each for a value not exceeding Rs. 1,250 crore.
- Mindtree: The company said that Dubai Aviation Corp Flydubai had selected it as its technology partner.
- Granules India: Drug maker Granules India has received approval from the US health regulator to market generic Ibuprofen tablets -- used to treat fever, pain or inflammation -- in the American market. The Hyderabad-based company said US Food and Drug Administration (USFDA) has approved its abbreviated new drug applications (ANDA) for Ibuprofen tablets in strengths of 400 mg, 600 mg, and 800 mg.
- DLF:Realty major DLF on Wednesday said its shopping mall in Noida, touted as one of the biggest in the country and built at an investment of Rs 1,100 crore, will be opened in November. DLF is expecting Rs 200 crore rental income per year from this mall, which has a leasable area of about 2 million sq ft.
SBI to stop accepting cash transactions and remittance in Shanghai from October 1
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State Bank of India (SBI) has said that it will stop accepting cash transactions and cash remittance from its main branch in China (Shanghai) starting October 1, only four months after Prime Minister Narendra Modi 's high-profile community reception in the city, where he exhorted non-resident Indians (NRIs ) to play a greater role in India's growth story.
An announcement from the bank on its website said that cash transactions "will not be entertained" with effect from October 1, 2015, "as per the direction from our head office". SBI officials in Shanghai said that the directive came from the headquarters after a periodical review, and left the branch with little option but to stop the popular service. Officials said the bank would focus on corporate banking as it in any case does not have a retail licence in China to serve the locals.
The move to scale down its retail service has left Indians, who were dependent on the bank to send remittance home, displeased as this was among few avenues to send money to their relatives in India without paying high transfer costs.
"There are people like Indian chefs and small traders, who needed the bank to send money home," said Tony Daryanani from Pune, who runs a popular tailoring business in Shanghai and has been staying here for the last 15 years. "Only in May, we had Prime Minister Narendra Modi come to Shanghai and tell people to help India grow and send money, and now they are telling NRIs that they cannot accept money and are not opening accounts anymore."
While officials say few people were using the service regularly, maintaining it required manpower and investment that did not make economic sense. Bank officials did acknowledge that the decision would cause inconvenience to Indians living in China, which they regretted.
An Indian who was using the bank to send money to his family said that the decision would also send a negative signal to NRIs in China about how India Inc was looking at the future of economic ties with the country in the coming months, after PM Modi's high-profile visit. "What message does this send to people who want to come to China and start businesses if they cannot using a major Indian bank to send money home?" he asked.
State Bank of India (SBI) has said that it will stop accepting cash transactions and cash remittance from its main branch in China (Shanghai) starting October 1, only four months after Prime Minister Narendra Modi 's high-profile community reception in the city, where he exhorted non-resident Indians (NRIs ) to play a greater role in India's growth story.
An announcement from the bank on its website said that cash transactions "will not be entertained" with effect from October 1, 2015, "as per the direction from our head office". SBI officials in Shanghai said that the directive came from the headquarters after a periodical review, and left the branch with little option but to stop the popular service. Officials said the bank would focus on corporate banking as it in any case does not have a retail licence in China to serve the locals.
The move to scale down its retail service has left Indians, who were dependent on the bank to send remittance home, displeased as this was among few avenues to send money to their relatives in India without paying high transfer costs.
"There are people like Indian chefs and small traders, who needed the bank to send money home," said Tony Daryanani from Pune, who runs a popular tailoring business in Shanghai and has been staying here for the last 15 years. "Only in May, we had Prime Minister Narendra Modi come to Shanghai and tell people to help India grow and send money, and now they are telling NRIs that they cannot accept money and are not opening accounts anymore."
While officials say few people were using the service regularly, maintaining it required manpower and investment that did not make economic sense. Bank officials did acknowledge that the decision would cause inconvenience to Indians living in China, which they regretted.
An Indian who was using the bank to send money to his family said that the decision would also send a negative signal to NRIs in China about how India Inc was looking at the future of economic ties with the country in the coming months, after PM Modi's high-profile visit. "What message does this send to people who want to come to China and start businesses if they cannot using a major Indian bank to send money home?" he asked.
US Federal Reserve keeps interest rates unchanged on global economy worries
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The US Federal Reserve kept interest rates unchanged on Thursday in a bow to worries about the global economy, financial market volatility and sluggish inflation at home, but left open the possibility of a modest policy tightening later this year.
In what amounted to a tactical retreat, Fed Chair Janet Yellen said developments in a tightly linked global economy had in effect forced the US central bank's hand. "The outlook abroad appears to have become less certain," Yellen told a news conference after the Fed's policy-setting committee released a statement following a two-day meeting.
She added that a recent fall in US stock prices and a rise in the value of the dollar already were tightening financial market conditions, which could slow US economic growth regardless of what the Fed does.
"In light of the heightened uncertainty abroad ... the committee judged it appropriate to wait," Yellen said.
The policy statement also nodded squarely to the global economy as a decisive variable within Yellen's "data-dependent" Fed, warning that recent developments abroad and in financial markets might restrain economic activity somewhat and likely put further downward pressure on inflation in the near term.
But the Fed maintained its bias towards a rate hike sometime this year, while lowering its long-term outlook for the economy.
Fresh economic projections showed 13 of 17 Fed policymakers foresee raising rates at least once in 2015, down from 15 at the last meeting in June.
Traders in futures markets cut bets that the central bank would lift rates by December to around a 47 per cent probability, from 64 per cent before the release of the policy statement.
"We're in the same situation we were in before, which is uncertainty about when are they going to move," said John Bonnell, a senior portfolio manager at USAA Investments in San Antonio, Texas.
Four Fed policymakers now say rates should not be raised until at least 2016, compared to two who felt that way in June. The Fed has policy meetings in October and December.
In deciding when to hike rates, the Fed repeated it wanted to see "some further improvement in the labour market," and be "reasonably confident" that inflation will increase.
The dollar fell sharply against a basket of currencies after the release of the statement. Stocks initially edged higher before falling and ending the trading session lower. Prices for US Treasuries rose.
'MORE DOVISH'
Taken as a whole, the latest Fed projections of slower GDP growth, low unemployment and continuing low inflation suggest that concerns of a so-called secular stagnation may be taking root among policymakers. One policymaker even suggested a negative federal funds rate.
The median projection of the 17 policymakers showed the Fed expects the economy to grow 2.1 per cent this year, slightly faster than previously thought. However, its forecasts for GDP growth in 2016 and 2017 were downgraded.
The Fed also forecast inflation would creep only slowly toward its 2 per cent target even as unemployment dips lower than previously expected. It sees the unemployment rate hitting 4.8 per cent next year and remaining at that level for as long as three years.
The Fed's projected interest rate path shifted downward, with the long-run federal funds rate now seen at 3.5 per cent, compared to 3.75 per cent at the last policy meeting.
Fed officials like board member Jerome Powell and Atlanta Fed President Dennis Lockhart in recent months had publicly endorsed a September rate hike, forming a near majority along with longstanding inflation hawks like Richmond Fed President Jeffrey Lacker. Only Lacker, who wanted to raise rates by a quarter percentage point, dissented on Thursday.
The US Federal Reserve kept interest rates unchanged on Thursday in a bow to worries about the global economy, financial market volatility and sluggish inflation at home, but left open the possibility of a modest policy tightening later this year.
In what amounted to a tactical retreat, Fed Chair Janet Yellen said developments in a tightly linked global economy had in effect forced the US central bank's hand. "The outlook abroad appears to have become less certain," Yellen told a news conference after the Fed's policy-setting committee released a statement following a two-day meeting.
She added that a recent fall in US stock prices and a rise in the value of the dollar already were tightening financial market conditions, which could slow US economic growth regardless of what the Fed does.
"In light of the heightened uncertainty abroad ... the committee judged it appropriate to wait," Yellen said.
The policy statement also nodded squarely to the global economy as a decisive variable within Yellen's "data-dependent" Fed, warning that recent developments abroad and in financial markets might restrain economic activity somewhat and likely put further downward pressure on inflation in the near term.
But the Fed maintained its bias towards a rate hike sometime this year, while lowering its long-term outlook for the economy.
Fresh economic projections showed 13 of 17 Fed policymakers foresee raising rates at least once in 2015, down from 15 at the last meeting in June.
Traders in futures markets cut bets that the central bank would lift rates by December to around a 47 per cent probability, from 64 per cent before the release of the policy statement.
"We're in the same situation we were in before, which is uncertainty about when are they going to move," said John Bonnell, a senior portfolio manager at USAA Investments in San Antonio, Texas.
Four Fed policymakers now say rates should not be raised until at least 2016, compared to two who felt that way in June. The Fed has policy meetings in October and December.
In deciding when to hike rates, the Fed repeated it wanted to see "some further improvement in the labour market," and be "reasonably confident" that inflation will increase.
The dollar fell sharply against a basket of currencies after the release of the statement. Stocks initially edged higher before falling and ending the trading session lower. Prices for US Treasuries rose.
'MORE DOVISH'
'MORE DOVISH'
Taken as a whole, the latest Fed projections of slower GDP growth, low unemployment and continuing low inflation suggest that concerns of a so-called secular stagnation may be taking root among policymakers. One policymaker even suggested a negative federal funds rate.
The median projection of the 17 policymakers showed the Fed expects the economy to grow 2.1 per cent this year, slightly faster than previously thought. However, its forecasts for GDP growth in 2016 and 2017 were downgraded.
The Fed also forecast inflation would creep only slowly toward its 2 per cent target even as unemployment dips lower than previously expected. It sees the unemployment rate hitting 4.8 per cent next year and remaining at that level for as long as three years.
The Fed's projected interest rate path shifted downward, with the long-run federal funds rate now seen at 3.5 per cent, compared to 3.75 per cent at the last policy meeting.
Fed officials like board member Jerome Powell and Atlanta Fed President Dennis Lockhart in recent months had publicly endorsed a September rate hike, forming a near majority along with longstanding inflation hawks like Richmond Fed President Jeffrey Lacker. Only Lacker, who wanted to raise rates by a quarter percentage point, dissented on Thursday.
Fed officials like board member Jerome Powell and Atlanta Fed President Dennis Lockhart in recent months had publicly endorsed a September rate hike, forming a near majority along with longstanding inflation hawks like Richmond Fed President Jeffrey Lacker. Only Lacker, who wanted to raise rates by a quarter percentage point, dissented on Thursday.
General Awareness
Important List of Cricket Stadiums in the World
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Dear Readers & Aspirants,we have collected some Important list of Stadiums in the World. Now-a-days one question is asking from Cricket Stadiums in the World. We hope, it will help you in Competitive exams.
Australia
Melbourne Cricket Ground, Mebourne
Sydney Cricket Ground, Sydney
The WACA, Perth
The Gabba, Brisbane, Queensland
Bangladesh
Sher-e-Bangla Cricket Stadium, Mirpur, DhakaEngland
The Lords, London
Old Trafford, Manchester
The Oval, Kensington
Trent Bridge, Nottingham
Birmingham, Warwickshire
Headingley, Leeds
Rose Bowl, Southampton
India
Eden Gardens, Kolkata
M.A. Chidambaram Stadium, Chennai
Wankhede Stadium, Mumbai
Feroz Shah Kotla, Delhi
Himachal Pradesh Cricket Association Stadium, Dharamshala
New Zealand
Eden Park, Auckland
Basin Reserve, Wellington
Pakistan
Gaddafi Stadium, Lahore
Karachi Cricket Stadium, Karachi
South Africa
The Wanderers, Johannesburg
Newlands Cricket Ground, Cape Town
Port Elizabeth (St George’s Oval), Port Elizabeth
SuperSport Park (formerly Centurion Park), Centurion, Gauteng
Sri Lanka
Galle International Stadium, Galle
West Indies
Queen’s Park Oval, Trinidad.
- Dear Readers & Aspirants,we have collected some Important list of Stadiums in the World. Now-a-days one question is asking from Cricket Stadiums in the World. We hope, it will help you in Competitive exams.Australia
Melbourne Cricket Ground, Mebourne
Sydney Cricket Ground, Sydney
The WACA, Perth
The Gabba, Brisbane, Queensland
Bangladesh
Sher-e-Bangla Cricket Stadium, Mirpur, DhakaEngland
The Lords, London
Old Trafford, Manchester
The Oval, Kensington
Trent Bridge, Nottingham
Birmingham, Warwickshire
Headingley, Leeds
Rose Bowl, Southampton
India
Eden Gardens, Kolkata
M.A. Chidambaram Stadium, Chennai
Wankhede Stadium, Mumbai
Feroz Shah Kotla, Delhi
Himachal Pradesh Cricket Association Stadium, Dharamshala
New Zealand
Eden Park, Auckland
Basin Reserve, Wellington
Pakistan
Gaddafi Stadium, Lahore
Karachi Cricket Stadium, Karachi
South Africa
The Wanderers, Johannesburg
Newlands Cricket Ground, Cape Town
Port Elizabeth (St George’s Oval), Port Elizabeth
SuperSport Park (formerly Centurion Park), Centurion, Gauteng
Sri Lanka
Galle International Stadium, Galle
West Indies
Queen’s Park Oval, Trinidad.
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