Now India's Decmber wholesale inflation skyrockets to 2.59% from 0.58%
India's annual rate of inflation based on wholesale prices skyrocketed to 2.59 per cent in December from 0.58 per cent in November, official data showed on Tuesday.
 
However, on a year-on-year (YoY) basis, the Wholesale Price Index (WPI) data furnished by the Ministry of Commerce and Industry showed a decelerating trend during December 2019, as inflation had risen to 3.46 per cent during the corresponding period of 2018.
 
"Build up inflation rate in the financial year so far was 2.42 per cent compared to a build up rate of 2.92 per cent in the corresponding period of the previous year," the ministry said in its review of 'Index Numbers of Wholesale Price in India' for December.
 
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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    COMMENTS

    Ramesh Poapt

    7 months ago

    difference between WPI and CPI is too high
    which will have to be addressed.

    December retail inflation skyrockets to 7.35% as food prices surge
    A massive rise in food prices lifted India's December retail inflation to 7.35% from 5.54% in November, official data showed on Monday.
     
    Similarly, on a year-on-year (YoY) basis, the Consumer Price Index (CPI) for December was higher than the corresponding period of last year when retail inflation stood at 2.11%.
     
    According to the data furnished by the National Statistical Office (NSO), the Consumer Food Price Index (CFPI) inflated to 14.12% during the month under review from an expansion of 10.01% in November 2019 and (-)2.65% rise reported for the corresponding period of last year.
     
    The data assumes significance as the Reserve Bank of India in its last monetary policy review maintained the key lending rates on account of rising retail inflation.
     
    The central bank is expected to keep the rates intact during the last monetary policy review for 2019-20 to be held in February.
     
    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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    FinMin may use more cash management bills in FY21 to meet debt obligations worth Rs3.02 lakh crore
    The government is likely to opt for auctioning of more cash management bills (CMBs) to meet the debt obligations of government bonds in the next fiscal standing at Rs 3.02 lakh crore to avoid putting pressure on higher borrowings from the market.
     
    Higher market borrowings can impact fiscal deficit. The redemption pressure that is to come in FY 21 include, on April 9, the debt obligations government has to meet is Rs 35,268.36 crore whole on April 22, the amount is Rs 6,000 crore and on May 3rd, the redemption pressure is of Rs 71,130 crore and on June 9, it is Rs 67,182 crore, as per RBI data. 
     
    Though the Union Budget 2020 will decide the fiscal deficit for the next financial year, it is now almost certain that the current fiscal deficit of 3.3% may be unattainable given the weak tax and disinvestment revenue positions. 
     
    Excess borrowing to meet debt servicing will create further mismatch between the revenue and expenditure which the government may try to avoid next fiscal. This leaves to banking on CMBs more for debt servicing to a large extend, said sources. 
     
    The Reserve Bank of India (RBI) on Friday announced the auction of a 63-Day Government of India Cash Management Bill. The central bank carries on the auctioning of GSec on behalf of the government. 
     
    Cash Management Bills are short term bills issued by the central government to meet its immediate cash needs. 
     
    The bills will be auctioned on Monday and will mature on March 13, 2020 will raise Rs 30,000 crore.Government bonds worth Rs 61,000 crore came up for redemption on January 2 when investors received the money back with interest, RBI data revealed. 
     
    Similar maturities are falling due next two weeks for Rs 74,000 crore. On January 16, the redemption demand for Rs 74,000 falls which is a 8.19% G-Sec issued on January 16, 2012.
     
    The central bank has announced its third 'operation twist', a move in which the government's banker will buy G-Secs of long and medium tenure worth Rs 10,000 crore and at the same time sell government bonds of less than one year tenure. This is the third such operation by the RBI in as many weeks, aimed at pulling down the 10-year benchmark yield, which is a key determinant of the lending rates by banks.
     
    CMBs have a tenor usually less than 91 days while the T-bills have tenor 91 days, 182 days and 364 days. The day of issue of CMBs depend on the temporary cash requirement of the government. Since the government's revenue position is weak and the revenue expenditures are high , there is already a risk of running.
     
    RBI last year cut interest rates five times totalling 135 basis points . On December 19, it announced the first tranche of "Operation Twist", and the fall in yield on the 10-year G-Sec was 80 bps to 6.75% . But after three tranches of the operations, the benchmark yield fall on 10-year G-Secs has been 24 bps to 6.51%.
     
    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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    COMMENTS

    Ramesh Poapt

    7 months ago

    bang reform will take care shortly!

    ravi jagwani

    7 months ago

    these bills are short term in nature and since they cannot be carried beyond 31st march of any fiscal year any redemptions have to be funded either by market borrowings or some other source. so the title is misleading. the govt can raise treasury bills till 1yr to mellow the redemption impact but then it comes with a rollover risk.

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