India’s central bank is set to raise the benchmark repurchase rate and cash reserve ratio at its meeting tomorrow in a move to defend the rupee, according to the chairman of the nation’s biggest lender.
India’s central bank will not compromise on its fight against inflation to address a cash deficit in the banking system, Deputy Governor Subir Gokarn said, indicating that policy makers will refrain from cutting the amount lenders need to set aside as reserves.
Emerging markets led global stocks to the fourth monthly gain in September, the longest streak since 2007, handing equity investors better returns than bonds, commodities and the dollar and pushing them ahead for the year.
India said it is better to increase regulation for lenders rather than imposing a bank tax, joining Canada in publicly opposing a new levy on financial institutions that some European leaders have pushed for.
Yes Bank Ltd., the best-performing Indian bank stock last year, has lost almost half its market value in less than a month on investors’ concern that a record surge in interest rates will erode profits and boost defaults.