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Housing price inflation moderates
Lack of affordability leads to muted growth in housing prices
 
House Price Inflation is moderating as per Reserve Bank of India's Housing Price Index (HPI). House price inflation reduced to 9.8% y-o-y in the October-December quarter of 2015. This is the lowest ever-recorded number since the first quarter of CY2010. It is also a significant reduction from the 13.1% housing inflation witnessed in the third quarter of CY2015.  The previous low was in Q3FY13-14 when the rate of increase stood at 10.1%. On a annual basis, prices rose by 13.6% in 2015. In absolute terms, HPI increased to 221.7 from 218.2 as compared to the previous quarter. The base for 2010-11 is 100. 
 
HPI tracks Mumbai, Delhi, Chennai, Kolkata, Bengaluru, Lucknow, Ahmedabad, Jaipur, Kanpur and Kochi.  Out of the 10 cities, six reported a moderation in the rate of HPI. Jaipur witnessed a decline in prices on a y-o-y basis. Delhi and Mumbai witnessed around 10% rise in prices in the quarter. Lucknow reported the highest increase of 16.1%, while Kochi saw a rise of 8% 
 
Housing prices have risen significantly over the last decade, making owning a home a distant dream for many poor and middle-class households. Due to this lack of affordability, there is a lot of unsold housing inventory in some top-tier cities. This may keep the rate of growth in housing prices muted.

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Government makes a u-turn on EPF, agrees to 8.8 percent interest rate
New Delhi : In a major climbdown after persistent pressure from the trade unions and political parties, the government on Friday increased interest rate on employees provident fund (EPF) deposits to 8.8 percent for 2015-16 from 8.70 percent as it had announced earlier.
 
"I am happy to tell you that the EPF rate has been increased to 8.8 percent," Labour Minister Bandaru Dattatreya told reporters here.
 
The provident fund rate was 8.75 percent in 2014-15 and the Central Board of Trustees (CBT) had recommended to make it 8.8 percent for this fiscal. However, the finance ministry had rejected the recommendation and had approved only 8.70 percent interest, citing lower earnings.
 
Most trade unions had protested the decision and the issue was also raised by political parties both in parliament and outside. Trade unionist and Communist Party of India-Marxist MP Tapan Kumar Sen had also raised it in the Rajya Sabha.
 
Trade unions had threatened to intensify agitation from September if the government did not comply with the demand of higher EPF interest rates.
 
"This protest from all central trade unions is to condemn such arrogant, anti-worker approach of the central government," said a statement by All India Trade Union Congress (AITUC).
 
This is not the first u-turn the government has made in regard to the EPF.
 
On April 19, close on the heels of violent agitation in Bengaluru and also demand from trade unions, including from RSS-affiliated Bharatiya Mazdoor Sangh (BMS), the government had withdrawn its new rules of provident fund withdrawal.
 
According to the new norms proposed earlier this year, subscribers are not to be allowed to claim withdrawal of PF after attaining 54 years of age, and would have to wait till 57.
 
The earlier norms allowed contributors or subscribers to claim 90 percent of their accumulations in their PF account at the age of 54 years, and the final claims to be settled just one year before their retirement.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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DRT pulls up Diageo for delaying Mallya severance package details
Bengaluru : The Debt Recovery Tribunal (DRT) on Friday questioned liquor major Diageo for not yet submitting the specifics of $75 million severance package committed to embattled businessman Vijay Mallya.
 
"In my earlier ruling as well, I had directed the company (Diageo) to furnish the details of the severance package. Why it has not been placed before this court yet?" said DRT presiding officer C. R. Benakanahalli.
 
Benakanahalli directed Diageo to furnish the details of the severance package agreed with Mallya by May 12 in the hearing on applications filed by State Bank of India (SBI)-led bankers' consortium.
 
The SBI applied for first right on securing the $75 million severance package Mallya received on relinquishing the chairman's role at Diageo-owned United Spirits Limited (USL).
 
However, Benakanahalli overruled the bankers' demand to look into the case on a daily basis but promised to take it up on a priority basis. He posted the next hearing for June 2.
 
"As per the Supreme Court's direction, I have to complete the court proceedings into the matter in two months from the date of commencement of the hearing, so I will take the matter up on priority basis, not on daily basis, as I have many other cases pending before me, which also need timely disposal," he said.
 
Mallya's Kingfisher Airlines, grounded four years ago, owes more than Rs.9,000 crore to 17 banks.
 
Meanwhile, in an interview to Financial Times, Mallya said the charges against him are "preposterous" and that he was in "forced exile".
 
Mallya left for England on March 2, days before the bank consortium moved the Supreme Court to restrain him from leaving India.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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