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Finance and Investments Club - IIM Calcutta

Contents 1 Budget 2011 1.1 BOLD FROM THE BLUE 1.2 Lower Debt, More Froth 1.3 Hope, Skip and Jump 1.4 Not Pocket-Friendly 1.5 Small Change for now 1.6 Budget 2011 | Highlights & FM’s speech 1.7 Budget 2011: The Mint take 1.8 BUDGET EXPECTATIONS 1.9 More Than What Meets The ‘I’ 1.10 B-Day: What’s Expected 1.11 The country is expecting, Pranabda has to deliver 1.12 Decision on decontrolling urea prices unlikely in Union budget 1.13 Mamata going to market for money 1.14 Mint update| Railway Budget: Déjà vu 1.15 Budget May Lay Ground For FDI in Multi-Brand Retail 1.16 What Dalal Street Wants from FM 1.17 Fixing the deficit problem 1.18 WHAT TO EXPECT FROM BUDGET 2011 1.19 A REFORMS STIMULUS 1.20 Budget 2011: A road map to GST 1.21 PM Panel Wants Stimulus Withdrawn 1.22 Fresh Action on Corruption, Inflation and Jobs Growth? 1.23 Combating inflation is govt’s top priority: President 1.24 ISSUES THE BUDGET SHOULD RESOLVE 1.25 The Mechanics of Budget - All About India’s Largest Economic Decision-Making Exercise 1.26 Fresh action on corruption, inflation and jobs growth? 1.27 UPA to make reform push 1.28 Consolidating Fiscally on Paper 1.29 Pranab seeks support for GST after 3rd draft; bill this session 1.30 Mukherjee has little room for path-breaking budget 1.31 Bridging the execution deficit 1.32 Farm credit target to see 20% rise to 4,50,000 cr 1.33 Budget may subsidize interest on loans 1.34 The budget and the markets: The pain is already in the price 1.35 Fiscal numbers flatter to deceive 1.36 The year of living dangerously 1.37 What the budget numberssay about Mr India 1.38 Livemint.com - Full Coverage | Run-up to Budget 2011 1.39 Business Standard - Budget Expectation 1.40 Business Standard - Budget Columns 1.41 Business Standard - Budget and Industry 1.42 Business Standard - Budget and Economy 1.43 FM's Balancing Act 2 News 2.1 March 1, 2011 2.1.1 Oil Surges, Stocks Drop on Mideast Unrest; Gold Hits Record 2.1.2 Bernanke Sees Temporary Inflation Gain From Commodities 2.1.3 U.S. Manufacturing Grows at Fastest Pace Since 2004 2.1.4 Budget Special: 2.1.4.1 BOLD FROM THE BLUE 2.1.4.2 Lower Debt, More Froth 2.1.4.3 Hope, Skip and Jump 2.1.4.4 Not Pocket-Friendly 2.1.4.5 Small Change for now 2.2 February 28, 2011 2.2.1 Budget 2011 | Highlights & FM’s speech 2.2.2 Budget 2011: The Mint take 2.2.3 2012: YEAR OF HIGH INTEREST RATES 2.2.4 BEYOND INFLATION AND MONETARY SPEED-BREAKERS 2.2.5 New WPI Index, Same Old Problems 2.2.6 Rural Prosperity Behind Inflation 2.2.7 New chairman UK Sinha plans to revamp Sebi 2.2.8 Currency Wars Retreat as Fighting Inflation Makes Emerging Markets Winners 2.3 February 27, 2011 2.3.1 BUDGET EXPECTATIONS 2.3.2 More Than What Meets The ‘I’ 2.3.3 B-Day: What’s Expected 2.3.4 The country is expecting, Pranabda has to deliver 2.3.5 9% growth forecast difficult to achieve: Economists 2.3.6 FM may dole out tax sops to salaried class, farmers 2.3.7 Budget likely to give boost to infrastructure sector 2.3.8 Saudi Stocks Drop to Nine-Month Low, Leading Mideast, on Region's Unrest 2.4 February 26, 2011 2.4.1 Saudi Arabia increases oil output to make up for Libya 2.4.2 All Hunky Dory, Survey Sees India Back on 9% Growth Path in FY12 2.4.3 Indian Economy - Outlook bright, but... 2.4.4 Fiscal consolidation on track, may hit deficit target early 2.4.5 Goods Exports Help Narrow Widening Trade A/C Deficit 2.4.6 Govt Plans Dual Licence for Fin Inclusion Drive 2.4.7 IFRS implementation deferred 2.4.8 Decision on decontrolling urea prices unlikely in Union budget 2.5 February 25, 2011 2.5.1 U.S. Economy: Consumer Sentiment Climbs to Three-Year High 2.5.2 Budget May Lay Ground For FDI in Multi-Brand Retail 2.5.3 What Dalal Street Wants from FM 2.5.4 Rising Crude Threatens To Upset Fiscal Planning 2.5.5 Food Inflation Rises To 11.49%; PM Vows Relief With Help Of Food Security Law 2.5.6 Inflation will be curbed, but not at the cost of growth: PM 2.5.7 Fiscal consolidation on track, may hit deficit target early 2.5.8 MCA notifies accounting norms similar to IFRS 2.5.9 RBI to issue discussion paper on savings rate deregulation soon 2.5.10 Mamata going to market for money 2.5.11 Mint update| Railway Budget: Déjà vu 2.6 February 24, 2011 2.6.1 Economy: Jobless Claims Fall, Consumer Confidence Climbs 2.6.2 Inflation will be curbed, but not at the cost of growth: PM 2.6.3 Rising Current A/C Deficit Makes RBI Governor Sit up 2.6.4 Current Account Deficit In Mind, Govt Unveils Draft To Double Exports In 3 Yrs 2.6.5 BRIDGING THE FUNDING DEFICIT 2.6.6 Deregulation of oil prices critical 2.6.7 Investments From Tax Havens May Be Blocked 2.6.8 World trade volumes exceed pre-crisis level in December 2.6.9 RBI Unveils Tight Rules for CDS Introduction 2.7 February 23, 2011 2.7.1 Ballooning trade deficit unsustainable: Govt 2.7.2 Fixing the deficit problem 2.7.3 WHAT TO EXPECT FROM BUDGET 2011 2.7.4 A REFORMS STIMULUS 2.7.5 US oil at 2-1/2 yr high on Libyan supply worries 2.7.6 Oil May Surge to $220 If Libya, Algeria Halt, Nomura Says 2.7.7 I Beg to Differ, Prof Amartya Sen - As China’s experience shows, growth rate is not just a sideshow in the social development debate 2.7.8 RBI offers glimpse into thinking behind policy 2.7.9 Merkel Says EU Considering Extension of Financial Aid Program for Greece 2.8 February 22, 2011 2.8.1 Sarkozy calls on G20 finance ministers to agree reforms 2.8.2 IMF’s Feel of the Economy’s Pulse 2.8.3 Bernanke defends U.S. policies 2.8.4 Budget 2011: A road map to GST 2.8.5 Sensex declines as Libyan conflict spurs crude oil prices 2.8.6 PM Panel Wants Stimulus Withdrawn 2.8.7 Fresh Action on Corruption, Inflation and Jobs Growth? 2.8.8 BP to buy 30% in RIL blocks 2.8.9 FII Deals Under I-T Glare for STT Default 2.8.10 Indian Economy: A Report Card 2.9 February 21, 2011 2.9.1 Combating inflation is govt’s top priority: President 2.9.2 ISSUES THE BUDGET SHOULD RESOLVE 2.9.3 The Mechanics of Budget - All About India’s Largest Economic Decision-Making Exercise 2.9.4 Fresh action on corruption, inflation and jobs growth? 2.9.5 PM’s council sees FY12 growth at 9% 2.9.6 Watered-down deal threatens G-20 relevance 2.9.7 G-20 Overcomes China to Agree on Imbalance Yardsticks 2.9.8 Brent Crude Jumps to Two-Year High Above $108, Gold Rises on Libya Unrest 2.9.9 ECB Officials Signal They May Back Higher Interest Rates in Coming Months 2.10 February 20, 2011 2.10.1 G-20 ministers fudge deal on imbalance indicators 2.10.2 ECB Doesn't Exclude Possibility of Euro-Zone Inflation Risk, Trichet Says 2.10.3 FIIs likely to play it safe till Budget announced 2.10.4 UPA to make reform push 2.10.5 Geithner points to China yuan spillover to others 2.10.6 Global imbalances not India’s doing: FM 2.10.7 G-20 Agrees on Yardsticks for Imbalances as U.S. Seeks Leverage on Yuan 2.11 February 19, 2011 2.11.1 China Expected to Raise Bank Reserve Ratios Further 2.11.2 Debt-ceiling debate stirs up speculation 2.11.3 China rejects key G-20 imbalance indicators 2.11.4 The curious case of rising prices in international markets 2.11.5 Consolidating Fiscally on Paper 2.12 February 18, 2011 2.12.1 G-20 ministers squabble over imbalance diagnostics 2.12.2 MFIs demand bank funding resumption 2.12.3 Food inflation slows to two-month low as winter harvest hits market 2.12.4 Old challenges, new Sebi chief 2.12.5 ONGC Begins Roadshow for 5% Stake Sale, to Raise 12,000 Cr 2.12.6 RBI Investments in US T-bonds Touch All-Time High at $41.1 B 2.12.7 Central Bank Asks Large Finance Cos to Step Up CAR Till 15% 2.13 February 17, 2011 2.13.1 Markets edge lower; Anil Ambani firms drop 2.13.2 Food inflation slumps to 11.05% from 13.07% 2.13.3 Japan, India sign free trade pact; will scrap tariffs on 94% of goods 2.13.4 BSE, NSE See Little Chance of Mergers With Other Exchanges 2.13.5 How Bhave’s Term Was Regulated at Regulator! 2.13.6 China's Foreign Direct Investment Rises 23.4%, Adding to Overheating Risks 2.13.7 Fed Tells U.S. Banks to Test Capital For Recession Scenario 2.13.8 BNP Paribas Profit Rises 14% on Investment Bank, BancWest 2.14 February 16, 2011 2.14.1 FOMC Saw Stronger U.S. Recovery, Disappointed on Jobs 2.14.2 Trade and monetary issues top agenda at G-20 meeting 2.14.3 India Seen as Least Preferred Among Asia Pacific Markets 2.14.4 GST or not, Abolish Central Sales Tax 2.14.5 Savings and investment rates post a mild recovery in FY10 2.14.6 India, Japan to Sign Free-Trade Pact Today 2.14.7 Full Accounting Shift for Hedging Tools on Hold 2.15 February 15, 2011 2.15.1 NYSE, Deutsche Boerse unveil mega-exchange deal 2.15.2 Inflation Down A Tad, But Spreading 2.15.3 Inflation, Current Account Deficit Main Concerns 2.15.4 China Overtakes Japan as World’s No. 2 Economy 2.15.5 Infrastructure Bond Tax Gains Next Year Too 2.15.6 I-T to Check FDI from Mauritius for Black Taint 2.15.7 Finally, Govt Relents, Agrees to Set Up JPC 2.16 February 14, 2011 2.16.1 Govt bites the bullet on subsidies 2.16.2 Leading indicators point to India slowdown: OECD 2.16.3 A New Clause may Derail Vedanta Deal 2.16.4 Hefty Fine for ‘Insider Trade’ Looms Over RIL 2.16.5 Obama Submits $3.7 Trillion Budget, GOP Vows Fight 2.16.6 Geithner Quietly Tells Obama Debt-to-GDP Cost Poised to Increase to Record 2.16.7 Dodd-Frank May Cost $6.5 Billion and 5,000 Staff in Obama Budget 2.16.8 Roubini’s Next Crisis Is Scary Food for Thought: William Pesek 2.17 February 13, 2011 2.17.1 Markets rebound from 3-day fall, but down for 3rd week 2.17.2 Obama plans to cut deficit by $1.1 trillion 2.17.3 G20 sees 2 steps to tackling global imbalances: EU 2.17.4 D.Boerse, NYSE narrow in on name as talks intensify 2.17.5 U.S. oil falls to 10-week low as Mubarak steps down 2.18 February 12, 2011 2.18.1 Pranab seeks support for GST after 3rd draft; bill this session 2.18.2 FDI in multi-brand retailing likely to happen 2.18.3 Dec IIP growth chills, hits 20-month low 2.18.4 Fresh 500-cr sops for exporters 2.18.5 U.S. Stocks Rise After Mubarak's Resignation, Gain in Consumer Confidence 2.18.6 U.S. Mortgage Finance Overhaul May Create New Winners, Losers 2.19 February 11, 2011 2.19.1 Obama Administration Calls for Winding Down Fannie, Freddie 2.19.2 Mubarak Resigns as Egyptian President, Hands Power to Military 2.19.3 Buffett Tells FCIC It's Powerless to Stop `Too Big to Fail' 2.19.4 Mukherjee has little room for path-breaking budget 2.19.5 Food inflation falls to a seven-week low 2.19.6 Nokia, Microsoft join forces against Google, Apple 2.19.7 Markets rebound from 3-day fall, but down for 3rd week 2.19.8 Dec IIP slumps to 1.6% from 18% y-o-y 2.19.9 We need a better spectrum policy 2.19.10 Financing jitters as govt talks of more curbs on realty FDI 2.20 February 10, 2011 2.20.1 A growth story’s troubles 2.20.2 Dalal Street mavens see Sensex sinking 1,000 points more 2.20.3 The origin of India’s inflation problem 2.20.4 Centre raises compensation to break GST deadlock 2.20.5 Telecom: regulatory risk rears its head 2.20.6 DOHA TALKS NEED TO BE FINALIZED 2.20.7 China drought could stoke global food prices 2.20.8 Facebook Said to Be Worth $60 Billion in Employee Offering 2.21 February 9, 2011 2.21.1 Yuan Seen Reaching 17-Year High on Rate Increase: China Credit 2.21.2 Two Fed Skeptics of QE Say Inflation Underscores Risks 2.21.3 Markets close down 1% 2.21.4 Trai proposes higher spectrum price 2.21.5 Bridging the execution deficit 2.21.6 Loan-deposit mismatch may hit bank lending to infra sector 2.21.7 Bond sales tumble to 15-month low as interest rates spike 2.21.8 Stress on unorganised sector in new IIP 2.21.9 Farm credit target to see 20% rise to 4,50,000 cr 2.22 February 8, 2011 2.22.1 China Raises Interest Rates for Third Time After Growth Spurred Inflation 2.22.2 Gruebel Plans to Boost UBS Wealth Inflows After Second Quarterly Increase 2.22.3 Markets at 7-month closing low on inflation worries 2.22.4 Economy seen rolling at 8.6% on farm show 2.22.5 BSE escalates price war with rival NSE 2.22.6 India now on middle income path 2.22.7 Finmin, RBI should join hands on inflation 2.22.8 Budget may subsidize interest on loans 2.22.9 Indo-US Talks: Unlocking Trade Potential 2.22.10 Malegam report to hurt microfinance 2.23 February 7, 2011 2.23.1 Euro Buys Merkel Time as Bund-Treasury Spread Widens 2.23.2 The budget and the markets: The pain is already in the price 2.23.3 India on track to grow 8.6% in FY11 2.23.4 Markets edge up 0.2%; sentiment shaky 2.23.5 Oil falls as investors look past Egypt unrest 2.23.6 Egypt crisis adds to uncertainty about oil prices, says RBI 2.23.7 Fiscal numbers flatter to deceive 2.23.8 Revving up the bond market 2.24 February 6, 2011 2.24.1 Trade Deficit in U.S. Probably Widened as Imports Increased to Meet Demand 2.24.2 Market could rally on profits, technical 2.24.3 Budget 2011 outlook: Govt likely to address only the near-term problems 2.24.4 Worst not yet over for stock market, may fall further: Experts 2.24.5 Pranab mum on black money account holders 2.24.6 Egyptians Line Up for Cash as Banks Open, Currency Plummets to 2005 Low 2.25 February 5, 2011 2.25.1 Drop in Jobless Rate May Not Deter Fed From Carrying Out Stimulus Program 2.25.2 Inflation serious threat to growth: PM 2.25.3 Of Egypt, rising crude oil prices and uneasy heads of state 2.25.4 Bond yields rise on fears of inflation, hike in rates 2.25.5 ‘Inflation a threat to India growth story’ 2.25.6 The way forward for microfinance 2.26 February 4, 2011 2.26.1 U.S. Treasury Declines to Name China Currency Manipulator 2.26.2 Jobless Rate in U.S. Drops to 9%; Storms Limit Gain in Payrolls to 36,000 2.26.3 Bernanke gives sunny view of U.S. economic recovery 2.26.4 Food inflation accelerates, world prices at record high 2.26.5 Food inflation at 17.05%, steps on to soften impact 2.26.6 Financial inclusion lies with MFIs 2.26.7 SKS may shut shop in Andhra Pradesh 2.26.8 What the budget numberssay about Mr India 2.26.9 BSE may gain market share from smart order norm 2.26.10 For 2nd straight month, AI makes operating profit 2.27 February 3, 2011 2.27.1 Full Coverage | Run-up to Budget 2011 2.27.2 Pranab to sing different tune this budget 2.27.3 Govt may convert funds in PSU banks into equity 2.27.4 Why food prices could tumble soon 2.27.5 Food inflation accelerates for 2nd straight week 2.27.6 MFIs: Malegam misses the point 2.27.7 U.S. Economy: Service Industries Expand by Most Since 2005 2.27.8 Egypt's Anti-Mubarak Protesters Vow to Hold Ground 2.27.9 Euro Slides as Trichet Damps Rate-Increase Speculation; U.S. Stocks Fall 2.28 February 2, 2011 2.28.1 EU Leaders Plan Euro Pledge as Investors Bet on Debt Strategy 2.28.2 Brent near 28-month high, Egypt stays in focus 2.28.3 Manufacturing, Price Pressures on the Rise in Asia 2.28.4 Indian Banks Raise Interest Rates 2.28.5 Markets halt 5-day losing run; Bharti jumps 2.28.6 Tight liquidity won’t tame inflation 2.28.7 Malegam panel: brave but messy report 2.28.8 Bharti Q3 net falls 41%, more than forecast 2.28.9 Nomura posts 31% rise in 3rd quarter net profit 2.29 February 1, 2011 2.29.1 Oil’s Rally Ends as Egypt Risk Subsides; Brent Stays Above $100 2.29.2 Spain finance: Saving the savings banks 2.29.3 China central bank stresses price controls 2.29.4 Doha merry-go-round on trade 2.29.5 Joblessness, rising prices may spark war within nations: IMF 2.29.6 Markets end 1.6% lower as FIIs exit 2.29.7 Govt may hike tax exemption limit in Budget 2.29.8 GDP grew faster at 8% last fiscal 2.29.9 Rising provisions, bad loans to dent profits of state-run banks 2.30 January 31, 2011 2.30.1 The European debt spiral 2.30.2 Lonely Analyst Warns of 2015 Bank Crisis Amid `Upbeat' Davos 2.30.3 Stocks Extend Decline on Egypt Protests; U.S. Futures, Euro, Rice Advance 2.30.4 Govt approves $12 bn Posco steel plant 2.30.5 Markets end lower on global cues 2.30.6 Sebi plans to govern stock research 2.30.7 Sovereign bond yield curve turns flat on inflation concerns 2.30.8 Some DTC tax sops this budget itself 2.30.9 ADRs no substitute for FDI 2.31 January 30, 2011 2.31.1 Euro zone crisis seen turning corner 2.31.2 Sun out at Davos, managing recovery in limelight 2.31.3 Focus will be on Egypt, earnings, jobs data 2.31.4 WEF | Export curbs move into trade policy spotlight 2.31.5 Bankers play contrite, offer olive branch at Forum 2.31.6 Seven of top-10 cos shed nearly Rs50K cr in m-cap last week 2.31.7 India courts investment as FDI slides 2.31.8 India mulls import duty cuts to curb inflation 2.32 January 29, 2011 2.32.1 Panel cites roots of meltdown, but does it matter? Rated : Important 2.32.2 Panel: Negligence, risk-taking fueled economy's near-collapse 2.32.3 Debt crisis could tear up Europe, says Soros 2.32.4 Bernanke's Qe2 Hits Headwinds 2.32.5 Global stocks tumble on Egypt unrest, oil jumps 2.32.6 St lights dim, markets at five-month low 2.32.7 Rupee nears seven-week low as investors pull out 2.32.8 PFRDA Bill likely in next session 2.32.9 UK Sinha to step into Sebi chief’s shoes 2.33 January 28, 2011 2.33.1 U.S. Economy Quickens on Gains in Spending, Exports 2.33.2 Moody's Says Time Running Out for U.S. as S&P Cuts Japan 2.33.3 Wall Street’s Collapse to Be Mystery Forever: Jonathan Weil 2.33.4 Markets down for week; at near 5-month closing lows 2.33.5 Heavy govt spending likely in early FY12, says RBI 2.33.6 India’s fiscal challenges 2.33.7 Govt may infuse $3.3 bn into SBI via rights issue 2.34 January 27, 2011 2.34.1 Soros warns euro crisis could divide Europe 2.34.2 Trichet Signals EU Fund Could Buy Government Bonds 2.34.3 US federal deficit to hit record $1.5T 2.34.4 India food inflation at 15.57% y/y on Jan 15: Govt 2.34.5 Banks Sell First Swiss Franc Bonds for 24 Years: India Credit 2.34.6 Outlook for 2011 US economy is brightening: Survey 2.34.7 Japan's Credit Rating Cut to AA- by S&P on Debt Load 2.34.8 Davos: finding common ground in a complex world 2.34.9 How the G20 can prevent another financial crisis 2.34.10 A Nordic solution to Europe’s problems 2.34.11 Davos consensus: we're out of the woods, but... 2.34.12 Business Investment Climbs, Housing Stabilizes 2.34.13 AIG `Shouldn't Exist,' Ex-Chairman Says, Urging Breakup 2.34.14 Markets at 4-½ mth closing low; banks drop 2.34.15 Banks to monitor MFIs more closely 2.34.16 Central banks lack fiscal, farm support in inflation battle 2.34.17 RBI warns of difficult times ahead 2.35 January 26, 2011 2.35.1 India with $1,000 per capita income ready for growth marathon 2.35.2 Davos discourse to focus on jobless economic growth 2.35.3 King defends UK economic policy 2.35.4 Subbarao Seeks Fiscal Restraint to Tame India Prices 2.35.5 TARP Watchdog Says Success Damaged by ‘Moral Hazard’ 2.35.6 Brent Oil’s Record Open Interest Threatens WTI: Energy Markets 2.35.7 Chinese Banks Raise Rates as Much as 45%, Paper Says 2.35.8 Fed likely to keep $600B bond-purchase plan intact 2.35.9 Greece Default With Ireland to Break Euro by 2016 in Global Investor Poll 2.35.10 IMF warns of euro zone risk to global economy 2.35.11 China shows appetite for EFSF bond issue despite official's note of caution 2.35.12 Davos forum: Is China still an emerging economy? 2.35.13 Sales of New Homes in U.S. Rose More Than Forecast 2.35.14 RBI raises rates to fight inflation 2.35.15 Rates up, RBI still behind the curve 2.35.16 Over to fiscal policy to tackle inflation 2.35.17 RBI concerned about high credit growth 2.35.18 RBI highlights macro risks 2.35.19 Sensex closes below 19,000 on central bank rate hikes 2.35.20 Govt looking at allowing FDI in retail and defence: Scindia 2.36 January 25, 2011 2.36.1 Indian rupee weakens tracking euro; shares limit fall 2.36.2 India needs solution to $1.5 trillion puzzle 2.36.3 Sensex may return 10% as it's set to touch 21K: Deutsche Bank 2.36.4 Nifty expected to trade in 5600-5850 range 2.36.5 Too-Big-To-Fail Regulations Vex Lenders, Oudea Says 2.36.6 Spain Says Bank Shortfall Won’t Exceed $27 Billion 2.36.7 BRIC Inflation Imperils Consumer Stocks as Food Rises 2.36.8 Bank of Japan Raises Fiscal 2010 GDP Forecast to 3.3% 2.36.9 Bank of America’s Countrywide Accused in Suit of ‘Massive Fraud’ 2.36.10 Fed Likely to Press On With QE Even as Business Lending Rises 2.36.11 India raises rates in inflation fight 2.36.12 RBI sees economic growth moderating in 2011-12 2.36.13 Euro Falls on Renewed Debt Concern; Pound Slides as GDP Shrinks 2.36.14 Gold's dream climb expected to plateau in 2012 2.37 January 24, 2011 2.37.1 Euro's Slide Meets Resistance as Analysts Draw Line at $1.30 2.37.2 Halliburton Profit Rises as Oil Prices Boost Demand 2.37.3 Citigroup Bailout Warrants Will Be Auctioned by U.S. 2.37.4 Barclays Said to Plan Bonds for Banker Bonus Payments 2.37.5 Euro Bears Retreating From Merkel Pledge as Strategists Draw Line at $1.30 2.37.6 ECB to Keep Rate on Hold Until 4Q on Banks, Goldman Sachs Says: Tom Keene 2.37.7 Fed to go easy on applause 2.37.8 Maybe Japan was just a warm up to US’ rivalry with China 2.37.9 RBI warns on inflation risk; rate rise seen 2.37.10 Time to tighten monetary bolts 2.37.11 ICICI Bank posts Rs1,437 cr net profit in Q3 2.37.12 Clean-up of financial laws coming 2.37.13 Spectrum: For cash or growth? 2.38 January 23, 2011 2.38.1 Bankers expect up to 50 bps hike in policy rates 2.38.2 Tata Steel's Public Offer Covered Six Times 2.38.3 Spain to Ramp Up Bailout of Banks 2.38.4 Trichet Expects EU to Agree on More Automatic Enforcement of Budget Rules 2.38.5 Greek Finance Minister Aims to Avoid Restructuring, Eleftherotypia Reports 2.38.6 Don't rule out debt buy-back idea 2.38.7 Bank of America must be hoping for a dose of Citi’s tonic 2.38.8 Economy Probably Sped Up as U.S. Consumer Spending Rose Most in Four Years 2.39 January 22, 2011 2.39.1 European Rescue Fund May Buy Bonds, Recapitalize Banks, ECB's Stark Says 2.39.2 European Stocks Post First Weekly Decline of 2011 on Earnings, China Rates 2.39.3 What’s the relationship between inflation, bonds and stocks? 2.39.4 FM talks of inflation, fiscal responsibility at FSDC meet 2.39.5 Market keeps its fingers crossed ahead of rate call 2.39.6 SBI beats Street estimate; net profit up 14% at Rs2,828 cr 2.39.7 Banks aren’t in bad shape after all 2.39.8 RBI promises parity if foreign banks form arms 2.40 January 21, 2011 2.40.1 China Can Just Say `No' to One U.S. Export 2.40.2 why china won’t buy what the us can’t anytime soon 2.40.3 Montek sees inflation at 6.5% by March-end 2.40.4 Food inflation slows for second week 2.40.5 China economy grows 10.3 pct in 2010 2.40.6 Over A Barrel 2.40.7 OIL ON BOIL 2.40.8 No change likely in FSDC role 2.40.9 Microfinance: misunderstood, Malegamed 2.40.10 Banks tighten lending for commercial realty 2.40.11 Wipro underperforms again, joint CEOs resign 2.41 January 20,2011 2.41.1 China's Quickening Economic Growth Fans Speculation Interest Rates to Rise 2.41.2 Who says it doesn’t pay to default? 2.41.3 A throwback to the 1960s 2.41.4 India may attract $250 bn FDI in next five-year: Sharma 2.41.5 Food inflation eases, but RBI action seen 2.41.6 Panel moots 24% cap on microfinance loans 2.41.7 Here comes the Chinese MNC 2.41.8 Goldman profit slides as bond trading wilts 2.41.9 Morgan Stanley fourth-quarter profit jumps 2.42 January 19,2011 2.42.1 ECB Officials Edge Back From Threat of Higher Rates 2.42.2 Citigroup Earnings Miss Estimates as Stock and Bond Trading Revenue Slumps 2.42.3 The Latest American Export: Inflation 2.42.4 Volcker Rule Should Require Sign-Off by Bank CEOs, Panel Says 2.42.5 Opportunity, challenge at FDIC 2.42.6 Spain finance: Unsteady balance 2.42.7 IBM blows past forecasts, services contracts rise 2.42.8 Sensex rises 209 points on record TCS profit 2.42.9 World stocks surge to 28-month high 2.42.10 RBI,Sebi again slam reform role for FSDC 2.42.11 MFIs must go beyond lending 2.42.12 Looking inside insider trading laws 2.43 January 18,2011 2.43.1 EU Seeks to Bolster Crisis Safety Net as AAA Nations Weigh Cost 2.43.2 Portuguese Bailout Will Make Euro Crisis Worse: Matthew Lynn 2.43.3 China pushes back on renewed U.S. currency calls 2.43.4 Subbarao reiterates concern over inflation 2.43.5 RBI may define good, bad years, adjust bank provisioning norms 2.43.6 In record rush for funds, PE firms may findthe going tough 2.43.7 Sebi asks FIIs to monitor PN beneficiaries 2.44 January 17,2011 2.44.1 Euro zone finance ministers to discuss changes to rescue fund 2.44.2 Hu Says U.S. Must Respect Sovereignty, Defends Yuan 2.44.3 EU Begins Rescue Revamp as Germany Signals Flexibility 2.44.4 Govt decision on Cairn-Vedanta deal likely in few weeks 2.44.5 7 banks underwrite Tata Steel’s plan to raise funds 2.44.6 Global cues to dominate undertone 2.44.7 The impact of higher interest rates on the BSE-500 2.45 January 16,2011 2.45.1 Could the U.S. central bank go broke? 2.45.2 India to join OECD to pace efforts to check tax evasion 2.45.3 Citi to compensate for alleged fraud in Gurgaon 2.45.4 Sensex slips from 19k level, worst week since May 2.45.5 Analysts expect another subdued week at Dalal Street 2.45.6 Being Force Merger 2.45.7 Five world markets themes next week 2.45.8 Investors crave more strong bank results 2.45.9 Wall St bets against Whitney's dire view on municipal debt 2.46 January 15,2011 2.46.1 ECB warns on inflation, seeks bolder crisis action 2.46.2 Mixed results for Bank of Japan policy 2.46.3 Wait for complete package on debt crisis: Merkel 2.46.4 ECB's Smaghi says Ireland triggers new stress tests: report 2.46.5 J.P. Morgan results bode well for sector earnings 2.46.6 Euro paces best week since March 2009; gains ahead 2.46.7 Fed Officials Say Strengthening Economy Doesn't Alter Bond-Purchase Plans 2.46.8 HDFC profit rises 32.71% on sale of IL&FS stake 2.46.9 Inflation at 8.43%, rate hike looms 2.46.10 Sensex declines 10% from peak on interest rates concern 2.46.11 No Instant Solution To Food Security 2.47 January 14, 2011 2.47.1 New Year’s hope against hope 2.47.2 Europe financing: Sovereign crisis, sovereign solution 2.47.3 Europe Failed to Clear 'Skepticism' on Debt Crisis, IMF Says 2.47.4 World Bank sees capital-flow risks, global growth slowing in 2011 2.47.5 Govt’s inflation sops not a runaway hit 2.47.6 Food inflation unacceptably high: FM 2.47.7 Infosys third quarter earnings disappoint, sends stocks tumbling 2.47.8 Rupee weakens on stocks slide, inflation 2.47.9 Cabinet secy for multi-brand FDI 2.47.10 Banks may hold on to margins but provisions, NPAs set to rise 2.47.11 Govt mulls norms for Rs.1 trillion wealth management industry 2.48 January 13, 2011 2.48.1 Eurozone looks to ways of taming Portugal crisis 2.48.2 Geithner warns China on policies 2.48.3 Trichet Faces `Annus Horribilis' as Crisis Tests ECB 2.48.4 EU's New Drive to Contain Euro Debt Fire May Still Fall Short 2.48.5 Cairn deal set to get govt nod by Feb 2.48.6 It’s ‘worrying’ as IIP dips to 2.7% 2.48.7 Work speeded up on new index 2.48.8 Steps to combat inflation to be announced soon: FM 2.48.9 IFRS to see firms revisiting Esop offers 2.49 January 12, 2011 2.49.1 Focus on RBI as growth slumps 2.49.2 Pumping billions into wrong areas 2.49.3 Should policymakers trust the IIP or the PMI numbers? 2.49.4 Malegam panel for loan rate cap, RBI regulation 2.49.5 Sovereign default remains top 2011 risk for WEF 2.49.6 What’s the way forward on GST? 2.49.7 Spain economy: Feeling the pinch 2.49.8 China risk: Alert -- Policy-induced slowdown could overshoot 2.50 January 10,2011 2.50.1 Goldman Sachs Traders Said to Prepare Own Hedge Fund 2.50.2 China Currency Reserves Rise to Record $2.85 Trillion 2.51 January 9,2011 2.51.1 How inflation affects the Sensex 2.52 January 8, 2011 2.52.1 Bernanke and others express concern over US unemployment rates 2.52.2 Bond Sales Set Record in U.S. as GE Leads $48.5 Billion: Credit Markets 2.52.3 Looking to diversify, investors bet on catastrophes 2.53 January 7,2011 2.53.1 Chinese Yields Invert as Bond Shortage Outweighs Inflation 2.53.2 Is the Fed to blame for soaring all prices? 3 Deals 3.1 M&A 3.1.1 January 24, 2011 3.1.1.1 Sara Lee Said to Get Apollo Bid Close to $20 a Share 3.1.1.2 Rock-Tenn to Acquire Smurfit-Stone for $3.5 Billion 3.1.2 January 11,2011 3.1.2.1 IGate’s Bid for Rival Patni Fuels Expansion Concern 3.1.3 January 9, 2011 3.1.3.1 Duke Energy in advanced deal talks with Progress 3.1.4 January 8, 2011 3.1.4.1 Sanofi, Genzyme Said to Make Progress in Takeover Talks at Higher Offer 3.1.4.2 iGate-Patni deal likely to be inked on 10-01-11 3.1.4.3 Skype acquires Qik mobile video company 3.1.5 January 7,2011 3.1.5.1 Inox open offer for Fame fails to attract investors 3.2 IPO & FPO 3.2.1 January 27, 2011 3.2.1.1 3i acquires minority stake in BVG India 3.2.2 January 26, 2011 3.2.2.1 Nielsen Said to Raise About $1.6 Billion in U.S. IPO 3.2.2.2 Glencore Said to Seek $2.5 Billion in Hong Kong IPO 3.2.3 January 24, 2011 3.2.3.1 ONGC FPO likely to hit the market on March 15, 2011 3.2.3.2 Groupon Not Fully Committed to IPO, CEO Mason Says 4 Markets 4.1 Market Information 4.1.1 Stock Markets Spot Indices 4.1.2 Currency Exchange Rates 4.1.3 Bond Yields 4.1.4 Commodities 5 RBI Policy Reviews 5.1 January 25, 2011 5.2 January 24, 2011 5.2.1 Macroeconomic and Monetary Developments in the 3rd Quarter of 2011 6 Others 6.1 Video Links 6.2 Articles 6.2.1 1. A return to deal making in 2010 6.2.2 2. A bunch of interesting articles from Knowledge@Wharton 6.2.3 3. A Major Transformation': The Pros and Cons of the Dodd-Frank Act 6.2.4 4. The Dodd-Frank Financial Regulatory Law: Long-Awaited Cure -- or Cause for 'Wild-Eyed Alarm'? 6.2.5 5. The Global Economy in 2011: A Rocky Ride or Smoother Sailing Ahead? 6.2.6 6. Private Equity: Part of the Crisis or Part of the Solution? 6.2.7 7. Is China Private Equity's Next Rock Star? 6.2.8 8. The Goldman Sachs Facebook Deal: Is This Business as Usual? 6.2.9 9. The New BRICS on the Block: Which Emerging Markets Are Up and Coming? 6.2.10 10. Former Spanish Prime Minister Jose Maria Aznar on Bailouts, Protectionism and Why Europe Is a 'Declining Continent' 6.2.11 11. Outlook for US for Financial Year 2011 6.2.12 12. Five myths about US interest rates

Budget 2011

BOLD FROM THE BLUE

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Lower Debt, More Froth

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=14&EntityId=Ar01400&ViewMode=HTML

Hope, Skip and Jump

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=2&EntityId=Ar00200&ViewMode=HTML

Not Pocket-Friendly

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=10&EntityId=Ar01000&ViewMode=HTML

Small Change for now

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=11&ForceGif=true&EntityId=Ar01100&ViewMode=HTML

Budget 2011 | Highlights & FM’s speech

http://www.livemint.com/2011/02/28102954/Budget-2011--Highlights-amp.html

Budget 2011: The Mint take

http://www.livemint.com/2011/02/28145907/Budget-2011-The-Mint-take.html

BUDGET EXPECTATIONS

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=1&EntityId=Ar00100&ViewMode=HTML&GZ=T

More Than What Meets The ‘I’

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=6&EntityId=Ar00600&ViewMode=HTML&GZ=T

B-Day: What’s Expected

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=6&EntityId=Ar00601&ViewMode=HTML&GZ=T

The country is expecting, Pranabda has to deliver

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

Decision on decontrolling urea prices unlikely in Union budget

http://www.livemint.com/2011/02/26014613/Decision-on-decontrolling-urea.html?atype=tp

Mamata going to market for money

http://www.livemint.com/2011/02/25232930/Mamata-going-to-market-for-mon.html?h=A1

Mint update| Railway Budget: Déjà vu

http://www.livemint.com/2011/02/25155738/Mint-update-Railway-Budget-D.html?h=A2

Budget May Lay Ground For FDI in Multi-Brand Retail

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/25&PageLabel=1&EntityId=Ar00102&ViewMode=HTML&GZ=T

What Dalal Street Wants from FM

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/25&PageLabel=12&ForceGif=true&EntityId=Ar01200&ViewMode=HTML&GZ=T

Fixing the deficit problem

http://www.livemint.com/2011/02/22214908/Fixing-the-deficit-problem.html?atype=tp

WHAT TO EXPECT FROM BUDGET 2011

http://www.livemint.com/2011/02/22235724/WHAT-TO-EXPECT-FROM-BUDGET-201.html?atype=tp

A REFORMS STIMULUS

http://www.livemint.com/2011/02/22215038/A-REFORMS-STIMULUS.html?atype=tp

Budget 2011: A road map to GST

http://www.livemint.com/2011/02/22001735/Budget-2011-A-road-map-to-GST.html

PM Panel Wants Stimulus Withdrawn

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/22&PageLabel=10&EntityId=Ar01002&ViewMode=HTML&GZ=T

Fresh Action on Corruption, Inflation and Jobs Growth?

http://epaper.livemint.com/ArticleImage.aspx?article=22_02_2011_003_001&mode=1

Combating inflation is govt’s top priority: President

http://www.livemint.com/2011/02/21110645/Combating-inflation-is-govt8.html?h=A1

ISSUES THE BUDGET SHOULD RESOLVE

http://www.livemint.com/2011/02/20205956/ISSUES-THE-BUDGET-SHOULD-RESOL.html?atype=tp

The Mechanics of Budget - All About India’s Largest Economic Decision-Making Exercise

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/21&PageLabel=13&EntityId=Ar01300&ViewMode=HTML&GZ=T

Fresh action on corruption, inflation and jobs growth?

http://www.livemint.com/2011/02/22000341/Fresh-action-on-corruption-in.html?h=A1

UPA to make reform push

http://www.livemint.com/2011/02/18235243/UPA-to-make-reform-push.html?h=A1

Consolidating Fiscally on Paper

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/19&PageLabel=7&EntityId=Ar00701&ViewMode=HTML&GZ=T

Pranab seeks support for GST after 3rd draft; bill this session

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/12&PageLabel=7&EntityId=Ar00700&ViewMode=HTML&GZ=T

Mukherjee has little room for path-breaking budget

http://www.livemint.com/2011/02/10235136/Mukherjee-has-little-room-for.html?atype=tp

Bridging the execution deficit

http://www.livemint.com/2011/02/09004207/Bridging-the-execution-deficit.html?atype=tp

Farm credit target to see 20% rise to 4,50,000 cr

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/09&PageLabel=7&EntityId=Ar00703&ViewMode=HTML&GZ=T

Budget may subsidize interest on loans

http://www.livemint.com/2011/02/07200139/Budgetmaysubsidize-interest.html?atype=tp

The budget and the markets: The pain is already in the price

http://www.livemint.com/2011/02/06204947/The-budget-and-the-markets-Th.html?atype=tp

Fiscal numbers flatter to deceive

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/07&PageLabel=12&EntityId=Ar01200&ViewMode=HTML&GZ=T

The year of living dangerously

http://www.livemint.com/2011/02/02205849/The-year-of-living-dangerously.html

What the budget numberssay about Mr India

http://www.livemint.com/2011/02/03221424/What-the-budget-numberssay-abo.html?atype=tp

Livemint.com - Full Coverage | Run-up to Budget 2011

http://www.livemint.com/2011/02/03104726/Full-Coverage--Runup-to-Budg.html?h=A1

Business Standard - Budget Expectation

http://www.business-standard.com/runup/s_list.php?id=1

Business Standard - Budget Columns

http://www.business-standard.com/runup/s_list.php?id=2

Business Standard - Budget and Industry

http://www.business-standard.com/runup/s_list.php?id=3

Business Standard - Budget and Economy

http://www.business-standard.com/runup/s_list.php?id=4

FM's Balancing Act

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/03&PageLabel=7&ForceGif=true&EntityId=Ar00700&ViewMode=HTML&GZ=T

News

March 1, 2011

Oil Surges, Stocks Drop on Mideast Unrest; Gold Hits Record

http://www.bloomberg.com/news/2011-03-01/asian-stocks-gain-for-third-day-on-oil-drop-growth-outlook-yen-weakens.html

Bernanke Sees Temporary Inflation Gain From Commodities

http://www.bloomberg.com/news/2011-03-01/bernanke-sees-temporary-inflation-growth-from-crude-oil-commodity-prices.html

U.S. Manufacturing Grows at Fastest Pace Since 2004

http://www.bloomberg.com/news/2011-03-01/ism-index-of-manufacturing-in-u-s-rose-to-61-4-in-february.html

Budget Special:

BOLD FROM THE BLUE

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp? From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=1&EntityId=Ar00100&ViewMode=HTML

Lower Debt, More Froth

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=14&EntityId=Ar01400&ViewMode=HTML

Hope, Skip and Jump

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=2&EntityId=Ar00200&ViewMode=HTML

Not Pocket-Friendly

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=10&EntityId=Ar01000&ViewMode=HTML

Small Change for now

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/03/01&PageLabel=11&ForceGif=true&EntityId=Ar01100&ViewMode=HTML

February 28, 2011

Budget 2011 | Highlights & FM’s speech

http://www.livemint.com/2011/02/28102954/Budget-2011--Highlights-amp.html

Budget 2011: The Mint take

http://www.livemint.com/2011/02/28145907/Budget-2011-The-Mint-take.html

2012: YEAR OF HIGH INTEREST RATES

http://www.livemint.com/2011/02/27214206/2012-YEAR-OF-HIGH-INTEREST-RA.html?atype=tp

BEYOND INFLATION AND MONETARY SPEED-BREAKERS

http://www.livemint.com/2011/02/27212831/BEYOND-INFLATION-AND-MONETARY.html?atype=tp

New WPI Index, Same Old Problems

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/28&PageLabel=13&EntityId=Ar01303&ViewMode=HTML&GZ=T

Rural Prosperity Behind Inflation

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/28&PageLabel=16&EntityId=Ar01600&ViewMode=HTML&GZ=T

New chairman UK Sinha plans to revamp Sebi

http://www.livemint.com/2011/02/28011554/New-chairman-UKSinhaplans-to.html?atype=tp

Currency Wars Retreat as Fighting Inflation Makes Emerging Markets Winners

http://www.bloomberg.com/news/2011-02-28/currency-wars-retreat-as-fighting-inflation-makes-emerging-markets-winners.html

February 27, 2011

BUDGET EXPECTATIONS

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=1&EntityId=Ar00100&ViewMode=HTML&GZ=T

More Than What Meets The ‘I’

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=6&EntityId=Ar00600&ViewMode=HTML&GZ=T

B-Day: What’s Expected

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=6&EntityId=Ar00601&ViewMode=HTML&GZ=T

The country is expecting, Pranabda has to deliver

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/27&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

9% growth forecast difficult to achieve: Economists

http://www.livemint.com/2011/02/27123644/9-growth-forecast-difficult-t.html?h=A1

FM may dole out tax sops to salaried class, farmers

http://www.livemint.com/2011/02/27122054/FM-may-dole-out-tax-sops-to-sa.html?h=A1

Budget likely to give boost to infrastructure sector

http://www.livemint.com/2011/02/27120820/Budget-likely-to-give-boost-to.html?h=A1

Saudi Stocks Drop to Nine-Month Low, Leading Mideast, on Region's Unrest

http://www.bloomberg.com/news/2011-02-27/dubai-shares-rise-on-investor-bets-declines-are-overdone-deyaar-advances.html

February 26, 2011

Saudi Arabia increases oil output to make up for Libya

http://www.livemint.com/2011/02/25211046/Saudi-Arabia-increases-oil-out.html?atype=tp

All Hunky Dory, Survey Sees India Back on 9% Growth Path in FY12

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/26&ViewMode=HTML&GZ=T&PageLabel=1&EntityId=Ar00100&AppName=1&FontSize=g1

Indian Economy - Outlook bright, but...

http://www.livemint.com/2011/02/25230919/Outlook-bright-but.html?atype=tp

Fiscal consolidation on track, may hit deficit target early

http://www.livemint.com/2011/02/25215054/Fiscal-consolidation-on-track.html?atype=tp

Goods Exports Help Narrow Widening Trade A/C Deficit

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/26&PageLabel=13&EntityId=Ar01304&ViewMode=HTML&GZ=T

Govt Plans Dual Licence for Fin Inclusion Drive

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/26&PageLabel=9&EntityId=Ar00900&ViewMode=HTML&GZ=T

IFRS implementation deferred

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/26&PageLabel=13&EntityId=Ar01303&ViewMode=HTML&GZ=T

Decision on decontrolling urea prices unlikely in Union budget

http://www.livemint.com/2011/02/26014613/Decision-on-decontrolling-urea.html?atype=tp

February 25, 2011

U.S. Economy: Consumer Sentiment Climbs to Three-Year High

http://www.bloomberg.com/news/2011-02-25/u-s-consumer-confidence-rises-more-than-estimated-as-index-registers-77-5.html

Budget May Lay Ground For FDI in Multi-Brand Retail

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/25&PageLabel=1&EntityId=Ar00102&ViewMode=HTML&GZ=T

What Dalal Street Wants from FM

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/25&PageLabel=12&ForceGif=true&EntityId=Ar01200&ViewMode=HTML&GZ=T

Rising Crude Threatens To Upset Fiscal Planning

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/25&PageLabel=15&EntityId=Ar01503&ViewMode=HTML&GZ=T

Food Inflation Rises To 11.49%; PM Vows Relief With Help Of Food Security Law

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/25&PageLabel=15&EntityId=Ar01506&ViewMode=HTML&GZ=T

Inflation will be curbed, but not at the cost of growth: PM

http://www.livemint.com/2011/02/24221104/Inflation-will-be-curbed-but.html?atype=tp

Fiscal consolidation on track, may hit deficit target early

http://www.livemint.com/2011/02/25222251/Fiscal-consolidation-on-track.html?h=A1

MCA notifies accounting norms similar to IFRS

http://www.livemint.com/2011/02/25220752/MCA-notifies-accounting-norms.html?h=A1

RBI to issue discussion paper on savings rate deregulation soon

http://www.livemint.com/2011/02/24213232/RBI-to-issue-discussion-paper.html?atype=tp

Mamata going to market for money

http://www.livemint.com/2011/02/25232930/Mamata-going-to-market-for-mon.html?h=A1

Mint update| Railway Budget: Déjà vu

http://www.livemint.com/2011/02/25155738/Mint-update-Railway-Budget-D.html?h=A2

February 24, 2011

Economy: Jobless Claims Fall, Consumer Confidence Climbs

http://www.bloomberg.com/news/2011-02-24/u-s-initial-jobless-claims-fell-22-000-to-391-000.html

Inflation will be curbed, but not at the cost of growth: PM

http://www.livemint.com/2011/02/24234303/Inflation-will-be-curbed-but.html?h=A1

Rising Current A/C Deficit Makes RBI Governor Sit up

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/24&PageLabel=1&EntityId=Ar00100&ViewMode=HTML&GZ=T

Current Account Deficit In Mind, Govt Unveils Draft To Double Exports In 3 Yrs

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/24&PageLabel=11&EntityId=Ar01105&ViewMode=HTML&GZ=T

BRIDGING THE FUNDING DEFICIT

http://www.livemint.com/2011/02/24003459/BRIDGING-THE-FUNDING-DEFICIT.html?atype=tp

Deregulation of oil prices critical

http://www.livemint.com/2011/02/24003513/Deregulation-of-oil-prices-cri.html?atype=tp

Investments From Tax Havens May Be Blocked

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/24&PageLabel=11&EntityId=Ar01102&ViewMode=HTML&GZ=T

World trade volumes exceed pre-crisis level in December

http://www.livemint.com/2011/02/24001338/World-trade-volumes-exceed-pre.html?atype=tp

RBI Unveils Tight Rules for CDS Introduction

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/24&PageLabel=19&EntityId=Ar01900&ViewMode=HTML&GZ=T

February 23, 2011

Ballooning trade deficit unsustainable: Govt

http://www.livemint.com/2011/02/23165837/Ballooning-trade-deficit-unsus.html?h=B

Fixing the deficit problem

http://www.livemint.com/2011/02/22214908/Fixing-the-deficit-problem.html?atype=tp

WHAT TO EXPECT FROM BUDGET 2011

http://www.livemint.com/2011/02/22235724/WHAT-TO-EXPECT-FROM-BUDGET-201.html?atype=tp

A REFORMS STIMULUS

http://www.livemint.com/2011/02/22215038/A-REFORMS-STIMULUS.html?atype=tp

US oil at 2-1/2 yr high on Libyan supply worries

http://www.livemint.com/2011/02/23130842/US-oil-at-212-yr-high-on-Lib.html?h=A1

Oil May Surge to $220 If Libya, Algeria Halt, Nomura Says

http://www.bloomberg.com/news/2011-02-23/oil-may-surge-to-220-a-barrel-if-libya-algeria-halt-output-nomura-says.html

I Beg to Differ, Prof Amartya Sen - As China’s experience shows, growth rate is not just a sideshow in the social development debate

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/23&PageLabel=14&EntityId=Ar01400&ViewMode=HTML&GZ=T

RBI offers glimpse into thinking behind policy

http://www.livemint.com/2011/02/23003551/RBI-offers-glimpse-into-thinki.html?atype=tp

Merkel Says EU Considering Extension of Financial Aid Program for Greece

http://www.bloomberg.com/news/2011-02-22/merkel-says-eu-considering-extension-of-financial-aid-program-for-greece.html

February 22, 2011

Sarkozy calls on G20 finance ministers to agree reforms

http://www.livemint.com/2011/02/20182104/Signs-of-decoupling-in-Paris.html?atype=tp

IMF’s Feel of the Economy’s Pulse

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/22&PageLabel=12&EntityId=Ar01200&ViewMode=HTML&GZ=T

Bernanke defends U.S. policies

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=24629

Budget 2011: A road map to GST

http://www.livemint.com/2011/02/22001735/Budget-2011-A-road-map-to-GST.html

Sensex declines as Libyan conflict spurs crude oil prices

http://www.livemint.com/2011/02/22160522/Sensex-declines-as-Libyan-conf.html?h=A2

PM Panel Wants Stimulus Withdrawn

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/22&PageLabel=10&EntityId=Ar01002&ViewMode=HTML&GZ=T

Fresh Action on Corruption, Inflation and Jobs Growth?

http://epaper.livemint.com/ArticleImage.aspx?article=22_02_2011_003_001&mode=1

BP to buy 30% in RIL blocks

http://www.livemint.com/2011/02/21160709/BP-to-buy-30-in-RIL-blocks.html

FII Deals Under I-T Glare for STT Default

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/22&PageLabel=8&EntityId=Ar00800&ViewMode=HTML&GZ=T

Indian Economy: A Report Card

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/22&PageLabel=10&ForceGif=true&EntityId=Ar01000&ViewMode=HTML&GZ=T

February 21, 2011

Combating inflation is govt’s top priority: President

http://www.livemint.com/2011/02/21110645/Combating-inflation-is-govt8.html?h=A1

ISSUES THE BUDGET SHOULD RESOLVE

http://www.livemint.com/2011/02/20205956/ISSUES-THE-BUDGET-SHOULD-RESOL.html?atype=tp

The Mechanics of Budget - All About India’s Largest Economic Decision-Making Exercise

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/21&PageLabel=13&EntityId=Ar01300&ViewMode=HTML&GZ=T

Fresh action on corruption, inflation and jobs growth?

http://www.livemint.com/2011/02/22000341/Fresh-action-on-corruption-in.html?h=A1

PM’s council sees FY12 growth at 9%

http://www.livemint.com/2011/02/21234553/PM8217s-council-sees-FY12-g.html?h=A1

Watered-down deal threatens G-20 relevance

http://www.livemint.com/2011/02/20210341/Watereddown-deal-threatens-G.html?atype=tp

G-20 Overcomes China to Agree on Imbalance Yardsticks

http://www.bloomberg.com/news/2011-02-21/g-20-overcomes-china-opposition-to-agree-on-yardsticks-to-gauge-imbalances.html

Brent Crude Jumps to Two-Year High Above $108, Gold Rises on Libya Unrest

http://www.bloomberg.com/news/2011-02-21/oil-gold-gain-asian-stocks-decline-as-tensions-escalate-in-middle-east.html

ECB Officials Signal They May Back Higher Interest Rates in Coming Months

http://www.bloomberg.com/news/2011-02-21/ecb-officials-signal-they-may-back-higher-interest-rates-in-coming-months.html

February 20, 2011

G-20 ministers fudge deal on imbalance indicators

http://www.livemint.com/2011/02/20155253/G20-ministers-fudge-deal-on-i.html?h=A1

ECB Doesn't Exclude Possibility of Euro-Zone Inflation Risk, Trichet Says

http://www.bloomberg.com/news/2011-02-19/ecb-doesn-t-exclude-possibility-of-euro-zone-inflation-risk-trichet-says.html

FIIs likely to play it safe till Budget announced

http://www.livemint.com/2011/02/20143646/FIIs-likely-to-play-it-safe-ti.html?h=A2

UPA to make reform push

http://www.livemint.com/2011/02/18235243/UPA-to-make-reform-push.html?h=A1

Geithner points to China yuan spillover to others

http://www.reuters.com/article/2011/02/20/us-g20-usa-idUSTRE71I2EW20110220?pageNumber=1

Global imbalances not India’s doing: FM

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/20&PageLabel=4&EntityId=Ar00400&ViewMode=HTML&GZ=T

G-20 Agrees on Yardsticks for Imbalances as U.S. Seeks Leverage on Yuan

http://www.bloomberg.com/news/2011-02-19/g-20-agree-to-closer-monitoring-of-economic-imbalances-to-prevent-crises.html

February 19, 2011

China Expected to Raise Bank Reserve Ratios Further

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=24569

Debt-ceiling debate stirs up speculation

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=24321

China rejects key G-20 imbalance indicators

http://www.livemint.com/2011/02/18213523/Chinarejects-key-G20-imbalan.html?atype=tp

The curious case of rising prices in international markets

http://www.livemint.com/2011/02/18201232/The-curious-case-of-rising-pri.html?atype=tp

Consolidating Fiscally on Paper

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/19&PageLabel=7&EntityId=Ar00701&ViewMode=HTML&GZ=T

February 18, 2011

G-20 ministers squabble over imbalance diagnostics

http://www.livemint.com/2011/02/18003002/G20-ministers-squabble-over-i.html?atype=tp

MFIs demand bank funding resumption

http://www.livemint.com/2011/02/18001841/MFIs-demand-bank-funding-resum.html?atype=tp

Food inflation slows to two-month low as winter harvest hits market

http://www.livemint.com/2011/02/18013603/Food-inflation-slows-to-twomo.html?atype=tp

Old challenges, new Sebi chief

http://www.livemint.com/2011/02/17202948/Old-challenges-new-Sebi-chief.html?atype=tp

ONGC Begins Roadshow for 5% Stake Sale, to Raise 12,000 Cr

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/18&PageLabel=7&EntityId=Ar00700&ViewMode=HTML&GZ=T

RBI Investments in US T-bonds Touch All-Time High at $41.1 B

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/18&PageLabel=7&EntityId=Ar00701&ViewMode=HTML&GZ=T

Central Bank Asks Large Finance Cos to Step Up CAR Till 15%

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/18&PageLabel=15&EntityId=Ar01501&ViewMode=HTML&GZ=T

February 17, 2011

Markets edge lower; Anil Ambani firms drop

http://www.livemint.com/2011/02/17095356/Markets-edge-lower-Anil-Amban.html?h=A2

Food inflation slumps to 11.05% from 13.07%

http://www.livemint.com/2011/02/17112340/Food-inflation-slumps-to-1105.html?h=A1

Japan, India sign free trade pact; will scrap tariffs on 94% of goods

http://www.livemint.com/2011/02/16232929/Japan-India-sign-free-trade-p.html?atype=tp

BSE, NSE See Little Chance of Mergers With Other Exchanges

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/17&PageLabel=7&EntityId=Ar00700&ViewMode=HTML&GZ=T

How Bhave’s Term Was Regulated at Regulator!

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/17&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

China's Foreign Direct Investment Rises 23.4%, Adding to Overheating Risks

http://www.bloomberg.com/news/2011-02-17/china-s-foreign-direct-investment-rises-23-4-adding-to-overheating-risks.html

Fed Tells U.S. Banks to Test Capital For Recession Scenario

http://www.bloomberg.com/news/2011-02-17/fed-tells-banks-to-stress-test-capital-for-recession-with-11-unemployment.html

BNP Paribas Profit Rises 14% on Investment Bank, BancWest

http://www.bloomberg.com/news/2011-02-17/bnp-paribas-profit-climbs-14-on-investment-bank-earnings-bancwest-unit.html

February 16, 2011

FOMC Saw Stronger U.S. Recovery, Disappointed on Jobs

http://www.bloomberg.com/news/2011-02-16/fed-officials-saw-stronger-u-s-recovery-disappointed-on-jobs.html

Trade and monetary issues top agenda at G-20 meeting

http://www.livemint.com/2011/02/15223553/Trade-and-monetary-issues-top.html?atype=tp

India Seen as Least Preferred Among Asia Pacific Markets

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/16&PageLabel=7&EntityId=Ar00701&ViewMode=HTML&GZ=T

GST or not, Abolish Central Sales Tax

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/16&PageLabel=12&EntityId=Ar01209&ViewMode=HTML&GZ=T

Savings and investment rates post a mild recovery in FY10

http://www.livemint.com/2011/02/15203450/Savings-and-investment-rates-p.html?atype=tp

India, Japan to Sign Free-Trade Pact Today

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/16&PageLabel=11&EntityId=Ar01104&ViewMode=HTML&GZ=T

Full Accounting Shift for Hedging Tools on Hold

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/16&PageLabel=11&EntityId=Ar01100&ViewMode=HTML&GZ=T

February 15, 2011

NYSE, Deutsche Boerse unveil mega-exchange deal

http://www.livemint.com/2011/02/15201413/NYSE-Deutsche-Boerse-unveil-m.html?h=A1

Inflation Down A Tad, But Spreading

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/15&PageLabel=13&EntityId=Ar01304&ViewMode=HTML&GZ=T

Inflation, Current Account Deficit Main Concerns

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/15&PageLabel=13&EntityId=Ar01302&ViewMode=HTML&GZ=T

China Overtakes Japan as World’s No. 2 Economy

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/15&PageLabel=21&EntityId=Ar02100&ViewMode=HTML&GZ=T

Infrastructure Bond Tax Gains Next Year Too

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/15&PageLabel=13&EntityId=Ar01301&ViewMode=HTML&GZ=T

I-T to Check FDI from Mauritius for Black Taint

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/15&PageLabel=1&EntityId=Ar00100&ViewMode=HTML&GZ=T

Finally, Govt Relents, Agrees to Set Up JPC

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/15&PageLabel=1&EntityId=Ar00103&ViewMode=HTML&GZ=T

February 14, 2011

Govt bites the bullet on subsidies

http://www.livemint.com/2011/02/14190640/Govt-bites-the-bullet-on-subsi.html?h=A1

Leading indicators point to India slowdown: OECD

http://www.livemint.com/2011/02/14221803/Leading-indicators-point-to-In.html?atype=tp

A New Clause may Derail Vedanta Deal

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/14&PageLabel=1&EntityId=Ar00102&ViewMode=HTML&GZ=T

Hefty Fine for ‘Insider Trade’ Looms Over RIL

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/14&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

Obama Submits $3.7 Trillion Budget, GOP Vows Fight

http://www.bloomberg.com/news/2011-02-14/obama-submits-a-3-7-trillion-budget-as-republicans-pledge-to-oppose-plan.html

Geithner Quietly Tells Obama Debt-to-GDP Cost Poised to Increase to Record

http://www.bloomberg.com/news/2011-02-14/geithner-quietly-tells-obama-debt-to-gnp-cost-poised-to-increase-to-record.html

Dodd-Frank May Cost $6.5 Billion and 5,000 Staff in Obama Budget

http://www.bloomberg.com/news/2011-02-14/dodd-frank-s-implementation-calls-for-6-5-billion-5-000-staff-in-budget.html

Roubini’s Next Crisis Is Scary Food for Thought: William Pesek

http://www.bloomberg.com/news/2011-02-13/roubini-s-next-crisis-makes-food-for-thought-commentary-by-william-pesek.html

February 13, 2011

Markets rebound from 3-day fall, but down for 3rd week

http://www.livemint.com/2011/02/11153905/Markets-rebound-from-3day-fal.html?h=A2

Obama plans to cut deficit by $1.1 trillion

http://www.reuters.com/article/2011/02/13/us-usa-budget-obama-idUSTRE71B1QU20110213

G20 sees 2 steps to tackling global imbalances: EU

http://www.reuters.com/article/2011/02/13/us-g20-eu-idUSTRE71C1JR20110213

D.Boerse, NYSE narrow in on name as talks intensify

http://www.reuters.com/article/2011/02/12/us-deutscheboerse-exchanges-idUSTRE71B1H220110212

U.S. oil falls to 10-week low as Mubarak steps down

http://www.reuters.com/article/2011/02/11/us-markets-oil-idUSTRE71192R20110211

February 12, 2011

Pranab seeks support for GST after 3rd draft; bill this session

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/12&PageLabel=7&EntityId=Ar00700&ViewMode=HTML&GZ=T

FDI in multi-brand retailing likely to happen

http://www.livemint.com/2011/02/11200112/FDI-in-multibrand-retailing-l.html?atype=tp

Dec IIP growth chills, hits 20-month low

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/12&PageLabel=1&EntityId=Ar00100&ViewMode=HTML&GZ=T

Fresh 500-cr sops for exporters

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/12&PageLabel=7&EntityId=Ar00701&ViewMode=HTML&GZ=T

U.S. Stocks Rise After Mubarak's Resignation, Gain in Consumer Confidence

http://www.bloomberg.com/news/2011-02-12/u-s-stocks-rise-for-a-second-week-on-m-a-retail-sales-egypt.html

U.S. Mortgage Finance Overhaul May Create New Winners, Losers

http://www.bloomberg.com/news/2011-02-12/u-s-mortgage-finance-overhaul-may-create-new-winners-losers.html

February 11, 2011

Obama Administration Calls for Winding Down Fannie, Freddie

http://www.bloomberg.com/news/2011-02-11/obama-administration-calls-for-ultimately-winding-down-fannie-freddie.html

Mubarak Resigns as Egyptian President, Hands Power to Military

http://www.bloomberg.com/news/2011-02-11/mubarak-leaves-presidency-hands-power-to-egypt-s-military-suleiman-says.html

Buffett Tells FCIC It's Powerless to Stop `Too Big to Fail'

http://www.bloomberg.com/news/2011-02-11/buffett-tells-fcic-it-s-powerless-to-stop-too-big-to-fail-.html

Mukherjee has little room for path-breaking budget

http://www.livemint.com/2011/02/10235136/Mukherjee-has-little-room-for.html?atype=tp

Food inflation falls to a seven-week low

http://www.livemint.com/2011/02/10222410/Food-inflation-falls-to-a-seve.html?atype=tp

Nokia, Microsoft join forces against Google, Apple

http://www.livemint.com/2011/02/11133523/Nokia-Microsoft-join-forces-a.html?h=A4

Markets rebound from 3-day fall, but down for 3rd week

http://www.livemint.com/2011/02/11153905/Markets-rebound-from-3day-fal.html?h=A2

Dec IIP slumps to 1.6% from 18% y-o-y

http://www.livemint.com/2011/02/11105130/Dec-IIP-slumps-to-16-from-18.html?h=A1

We need a better spectrum policy

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/11&PageLabel=12&EntityId=Ar01200&ViewMode=HTML&GZ=T

Financing jitters as govt talks of more curbs on realty FDI

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/11&PageLabel=7&EntityId=Ar00700&ViewMode=HTML&GZ=T

February 10, 2011

A growth story’s troubles

http://www.livemint.com/2011/02/09203150/A-growth-story8217s-trouble.html?atype=tp

Dalal Street mavens see Sensex sinking 1,000 points more

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/10&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

The origin of India’s inflation problem

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/10&PageLabel=8&EntityId=Ar00800&ViewMode=HTML&GZ=T

Centre raises compensation to break GST deadlock

http://www.livemint.com/2011/02/10230719/Centre-raises-compensation-to.html?h=A1

Telecom: regulatory risk rears its head

http://www.livemint.com/2011/02/10221909/Telecom-regulatory-risk-rears.html?h=A2

DOHA TALKS NEED TO BE FINALIZED

http://www.livemint.com/2011/02/09214205/DOHA-TALKS-NEED-TO-BE-FINALIZE.html?atype=tp

China drought could stoke global food prices

http://www.livemint.com/2011/02/09223156/China-drought-could-stoke-glob.html?atype=tp

Facebook Said to Be Worth $60 Billion in Employee Offering

http://www.bloomberg.com/news/2011-02-10/facebook-said-to-be-worth-60-billion-in-employee-offering.html

February 9, 2011

Yuan Seen Reaching 17-Year High on Rate Increase: China Credit

http://www.bloomberg.com/news/2011-02-08/china-s-yuan-seen-reaching-17-year-high-on-rate-increase.html

Two Fed Skeptics of QE Say Inflation Underscores Risks

http://www.bloomberg.com/news/2011-02-09/two-fed-skeptics-of-qe-say-inflation-underscores-program-risks.html

Markets close down 1%

http://www.livemint.com/2011/02/09152132/Markets-close-down-1-Anil-Am.html?h=A2

Trai proposes higher spectrum price

http://www.livemint.com/2011/02/09120424/Trai-proposes-higher-spectrum.html?h=A1

Bridging the execution deficit

http://www.livemint.com/2011/02/09004207/Bridging-the-execution-deficit.html?atype=tp

Loan-deposit mismatch may hit bank lending to infra sector

http://www.livemint.com/2011/02/09014102/Loandeposit-mismatch-may-hit.html?atype=tp

Bond sales tumble to 15-month low as interest rates spike

http://www.livemint.com/2011/02/09014200/Bond-sales-tumble-to-15month.html?atype=tp

Stress on unorganised sector in new IIP

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/09&PageLabel=7&EntityId=Ar00701&ViewMode=HTML&GZ=T

Farm credit target to see 20% rise to 4,50,000 cr

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/09&PageLabel=7&EntityId=Ar00703&ViewMode=HTML&GZ=T

February 8, 2011

China Raises Interest Rates for Third Time After Growth Spurred Inflation

http://www.bloomberg.com/news/2011-02-08/china-raises-benchmark-one-year-deposit-lending-rates-by-25-basis-points.html

Gruebel Plans to Boost UBS Wealth Inflows After Second Quarterly Increase

http://www.bloomberg.com/news/2011-02-08/ubs-net-income-increases-7-as-inflows-climb-for-second-straight-quarter.html

Markets at 7-month closing low on inflation worries

http://www.livemint.com/2011/02/08153909/Markets-at-7month-closing-low.html?h=A2

Economy seen rolling at 8.6% on farm show

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/08&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

BSE escalates price war with rival NSE

http://www.livemint.com/2011/02/08141355/BSE-escalates-price-war-with-r.html?h=A1

India now on middle income path

http://www.livemint.com/2011/02/08021623/India-now-on-middle-income-pat.html?atype=tp

Finmin, RBI should join hands on inflation

http://www.livemint.com/2011/02/07200120/Finmin-RBI-should-join-hands.html?atype=tp

Budget may subsidize interest on loans

http://www.livemint.com/2011/02/07200139/Budgetmaysubsidize-interest.html?atype=tp

Indo-US Talks: Unlocking Trade Potential

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/08&PageLabel=7&EntityId=Ar00701&ViewMode=HTML&GZ=T

Malegam report to hurt microfinance

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/08&PageLabel=8&EntityId=Ar00801&ViewMode=HTML&GZ=T

February 7, 2011

Euro Buys Merkel Time as Bund-Treasury Spread Widens

http://www.bloomberg.com/news/2011-02-07/euro-buys-merkel-time-as-bund-treasury-spread-at-two-year-high.html

The budget and the markets: The pain is already in the price

http://www.livemint.com/2011/02/06204947/The-budget-and-the-markets-Th.html?atype=tp

India on track to grow 8.6% in FY11

http://www.livemint.com/2011/02/07103633/India-on-track-to-grow-86-in.html?h=A1

Markets edge up 0.2%; sentiment shaky

http://www.livemint.com/2011/02/07153333/Markets-edge-up-02-sentimen.html?h=A2

Oil falls as investors look past Egypt unrest

http://www.livemint.com/2011/02/07091227/Oil-falls-as-investors-look-pa.html?h=A2

Egypt crisis adds to uncertainty about oil prices, says RBI

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/07&PageLabel=9&EntityId=Ar00900&ViewMode=HTML&GZ=T

Fiscal numbers flatter to deceive

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/07&PageLabel=12&EntityId=Ar01200&ViewMode=HTML&GZ=T

Revving up the bond market

http://www.livemint.com/2011/02/06201400/Revving-up-the-bond-market.html?atype=tp

February 6, 2011

Trade Deficit in U.S. Probably Widened as Imports Increased to Meet Demand

http://www.bloomberg.com/news/2011-02-06/trade-deficit-in-u-s-probably-widened-as-imports-increased-to-meet-demand.html

Market could rally on profits, technical

http://www.reuters.com/article/2011/02/06/us-usa-stocks-weekahead-idUSTRE7137C020110206

Budget 2011 outlook: Govt likely to address only the near-term problems

http://economictimes.indiatimes.com/news/economy/policy/budget-2011-outlook-govt-likely-to-address-only-the-near-term-problems/articleshow/7439884.cms

Worst not yet over for stock market, may fall further: Experts

http://economictimes.indiatimes.com/markets/analysis/worst-not-yet-over-for-stock-market-may-fall-further-experts/articleshow/7436014.cms

Pranab mum on black money account holders

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/06&PageLabel=1&EntityId=Ar00102&ViewMode=HTML&GZ=T

Egyptians Line Up for Cash as Banks Open, Currency Plummets to 2005 Low

http://www.bloomberg.com/news/2011-02-06/egypt-moves-854-million-to-financial-system-as-banks-open-after-protests.html

February 5, 2011

Drop in Jobless Rate May Not Deter Fed From Carrying Out Stimulus Program

http://www.bloomberg.com/news/2011-02-05/drop-in-jobless-rate-may-not-deter-fed-from-carrying-out-stimulus-program.html

Inflation serious threat to growth: PM

http://www.livemint.com/2011/02/04213418/Inflation-serious-threat-to-gr.html?atype=tp

Of Egypt, rising crude oil prices and uneasy heads of state

http://www.livemint.com/2011/02/04203234/Of-Egypt-rising-crude-oil-pri.html?atype=tp

Bond yields rise on fears of inflation, hike in rates

http://www.livemint.com/2011/02/04204934/Bond-yields-rise-on-fears-of-i.html?atype=tp

‘Inflation a threat to India growth story’

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/05&PageLabel=1&EntityId=Ar00103&ViewMode=HTML&GZ=T

The way forward for microfinance

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/05&PageLabel=6&EntityId=Ar00600&ViewMode=HTML&GZ=T

February 4, 2011

U.S. Treasury Declines to Name China Currency Manipulator

http://www.bloomberg.com/news/2011-02-04/u-s-treasury-declines-to-name-china-a-currency-manipulator-as-yuan-rises.html

Jobless Rate in U.S. Drops to 9%; Storms Limit Gain in Payrolls to 36,000

http://www.bloomberg.com/news/2011-02-04/u-s-unemployment-rate-tumbled-to-9-in-january-payrolls-increased-36-000.html

Bernanke gives sunny view of U.S. economic recovery

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23919

Food inflation accelerates, world prices at record high

http://www.livemint.com/2011/02/03214621/Food-inflation-accelerates-wo.html?atype=tp

Food inflation at 17.05%, steps on to soften impact

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/04&PageLabel=1&EntityId=Ar00102&ViewMode=HTML&GZ=T

Financial inclusion lies with MFIs

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/04&PageLabel=8&EntityId=Ar00800&ViewMode=HTML&GZ=T

SKS may shut shop in Andhra Pradesh

http://www.livemint.com/2011/02/03230622/SKS-may-shut-shop-in-Andhra-Pr.html?atype=tp

What the budget numberssay about Mr India

http://www.livemint.com/2011/02/03221424/What-the-budget-numberssay-abo.html?atype=tp

BSE may gain market share from smart order norm

http://www.livemint.com/2011/02/03224547/BSE-may-gain-market-share-from.html?atype=tp

For 2nd straight month, AI makes operating profit

http://www.livemint.com/2011/02/03222646/For-2nd-straight-month-AI-mak.html?atype=tp

February 3, 2011

Full Coverage | Run-up to Budget 2011

http://www.livemint.com/2011/02/03104726/Full-Coverage--Runup-to-Budg.html?h=A1

Pranab to sing different tune this budget

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/03&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

Govt may convert funds in PSU banks into equity

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/03&PageLabel=7&EntityId=Ar00702&ViewMode=HTML&GZ=T

Why food prices could tumble soon

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/03&PageLabel=8&EntityId=Ar00800&ViewMode=HTML&GZ=T

Food inflation accelerates for 2nd straight week

http://www.livemint.com/2011/02/03114836/Food-inflation-accelerates-for.html?h=A1

MFIs: Malegam misses the point

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/03&PageLabel=8&EntityId=Ar00801&ViewMode=HTML&GZ=T

U.S. Economy: Service Industries Expand by Most Since 2005

http://www.bloomberg.com/news/2011-02-03/u-s-service-industries-expand-at-faster-pace-as-ism-index-climbs-to-59-4.html

Egypt's Anti-Mubarak Protesters Vow to Hold Ground

http://www.bloomberg.com/news/2011-02-03/egypt-s-opposition-rejects-mubarak-talks-urges-supporters-to-hold-ground.html

Euro Slides as Trichet Damps Rate-Increase Speculation; U.S. Stocks Fall

http://www.bloomberg.com/news/2011-02-03/japanese-stocks-decline-on-earnings-unrest-in-egypt-crude-copper-climb.html

February 2, 2011

EU Leaders Plan Euro Pledge as Investors Bet on Debt Strategy

http://www.bloomberg.com/news/2011-02-01/eu-leaders-plan-euro-pledge-as-investors-bet-on-crisis-fighting-strategy.html

Brent near 28-month high, Egypt stays in focus

http://www.livemint.com/2011/02/02080942/Brent-near-28month-high-Egyp.html?h=A2

Manufacturing, Price Pressures on the Rise in Asia

http://online.wsj.com/article/SB10001424052748703439504576116823803454788.html?KEYWORDS=asia+++inflation+++imf

Indian Banks Raise Interest Rates

http://online.wsj.com/article/SB10001424052748703445904576117974235605228.html?mod=WSJINDIA_hpp_LEFTTopWhatNews

Markets halt 5-day losing run; Bharti jumps

http://www.livemint.com/2011/02/02152045/Markets-halt-5day-losing-run.html?h=A2

Tight liquidity won’t tame inflation

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/02&PageLabel=12&EntityId=Ar01201&ViewMode=HTML&GZ=T

Malegam panel: brave but messy report

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/02&PageLabel=12&EntityId=Ar01200&ViewMode=HTML&GZ=T

Bharti Q3 net falls 41%, more than forecast

http://www.livemint.com/2011/02/02084443/Bharti-Q3-net-falls-41-more.html?h=A4

Nomura posts 31% rise in 3rd quarter net profit

http://www.livemint.com/2011/02/02135739/Nomura-posts-31-rise-in-3rd-q.html?h=A4

February 1, 2011

Oil’s Rally Ends as Egypt Risk Subsides; Brent Stays Above $100

http://www.bloomberg.com/news/2011-02-01/oil-drops-from-two-year-high-as-investors-sell-after-rally-on-egypt-unrest.html

Spain finance: Saving the savings banks

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/01&PageLabel=9&EntityId=Ar00902&ViewMode=HTML&GZ=T

China central bank stresses price controls

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23704

Doha merry-go-round on trade

http://www.livemint.com/2011/01/31203433/Doha-merrygoround-on-trade.html?atype=tp

Joblessness, rising prices may spark war within nations: IMF

http://www.livemint.com/2011/02/01144204/Joblessness-rising-prices-may.html?h=A1

Markets end 1.6% lower as FIIs exit

http://www.livemint.com/2011/02/01151631/Markets-end-16-lower-as-FIIs.html?h=A2

Govt may hike tax exemption limit in Budget

http://www.livemint.com/2011/02/01173335/Govt-may-hike-tax-exemption-li.html?h=A1

GDP grew faster at 8% last fiscal

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/02/01&PageLabel=9&EntityId=Ar00902&ViewMode=HTML&GZ=T

Rising provisions, bad loans to dent profits of state-run banks

http://www.livemint.com/2011/01/31231712/Rising-provisions-bad-loans-t.html?atype=tp

January 31, 2011

The European debt spiral

http://www.livemint.com/2011/01/30193406/The-European-debt-spiral.html?atype=tp

Lonely Analyst Warns of 2015 Bank Crisis Amid `Upbeat' Davos

http://www.bloomberg.com/news/2011-01-31/lonely-analyst-warns-of-2015-bank-crisis-amid-upbeat-davos.html

Stocks Extend Decline on Egypt Protests; U.S. Futures, Euro, Rice Advance

http://www.bloomberg.com/news/2011-01-31/asian-stocks-u-s-futures-fall-as-dollar-yen-oil-gain-on-egypt-unrest.html

Govt approves $12 bn Posco steel plant

http://www.livemint.com/2011/01/31132039/Govt-approves-12-bn-Posco-ste.html?h=A1

Markets end lower on global cues

http://www.livemint.com/2011/01/31153130/Markets-end-lower-on-global-cu.html?h=A2

Sebi plans to govern stock research

http://www.livemint.com/2011/01/30212955/Sebiplansto-governstock-res.html?atype=tp

Sovereign bond yield curve turns flat on inflation concerns

http://www.livemint.com/2011/01/30201814/Sovereign-bond-yield-curve-tur.html?atype=tp

Some DTC tax sops this budget itself

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/01/31&PageLabel=9&EntityId=Ar00903&ViewMode=HTML&GZ=T

ADRs no substitute for FDI

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/01/31&PageLabel=16&EntityId=Ar01603&ViewMode=HTML&GZ=T

January 30, 2011

Euro zone crisis seen turning corner

http://www.reuters.com/article/2011/01/29/us-davos-eurozone-idUSTRE70S1GK20110129

Sun out at Davos, managing recovery in limelight

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/01/30&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

Focus will be on Egypt, earnings, jobs data

http://www.reuters.com/article/2011/01/28/us-usa-stocks-weekahead-idUSTRE70R94120110128

WEF | Export curbs move into trade policy spotlight

http://www.livemint.com/2011/01/30164923/WEF--Export-curbs-move-into-t.html?h=A1

Bankers play contrite, offer olive branch at Forum

http://www.reuters.com/article/2011/01/29/us-davos-financial-regulation-idUSTRE70S1WM20110129

Seven of top-10 cos shed nearly Rs50K cr in m-cap last week

http://www.livemint.com/2011/01/30114233/Seven-of-top10-cos-shed-nearl.html?h=A2

India courts investment as FDI slides

http://www.livemint.com/2011/01/30132154/India-courts-investment-as-FDI.html?h=A1

India mulls import duty cuts to curb inflation

http://www.livemint.com/2011/01/30135757/India-mulls-import-duty-cuts-t.html?h=A1

January 29, 2011

Panel cites roots of meltdown, but does it matter? Rated : Important

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23542

Panel: Negligence, risk-taking fueled economy's near-collapse

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23554

Debt crisis could tear up Europe, says Soros

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23588

Bernanke's Qe2 Hits Headwinds

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23545

Global stocks tumble on Egypt unrest, oil jumps

http://www.reuters.com/article/2011/01/28/us-markets-global-idUSTRE70D1FB20110128

St lights dim, markets at five-month low

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/01/29&PageLabel=1&EntityId=Ar00100&ViewMode=HTML&GZ=T

Rupee nears seven-week low as investors pull out

http://www.livemint.com/2011/01/28200323/Rupee-nears-sevenweek-low-as.html?atype=tp

PFRDA Bill likely in next session

http://www.livemint.com/2011/01/28222734/PFRDA-Bill-likely-in-nextsess.html?atype=tp

UK Sinha to step into Sebi chief’s shoes

http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/01/29&PageLabel=1&EntityId=Ar00101&ViewMode=HTML&GZ=T

January 28, 2011

U.S. Economy Quickens on Gains in Spending, Exports

http://www.bloomberg.com/news/2011-01-28/u-s-economy-expands-amid-biggest-gains-in-consumer-spending-in-four-years.html

Moody's Says Time Running Out for U.S. as S&P Cuts Japan

http://www.bloomberg.com/news/2011-01-28/moody-s-says-time-shortens-for-u-s-rating-outlook-as-s-p-downgrades-japan.html

Wall Street’s Collapse to Be Mystery Forever: Jonathan Weil

http://www.bloomberg.com/news/2011-01-28/wall-street-s-collapse-to-be-mystery-forever-commentary-by-jonathan-weil.html

Markets down for week; at near 5-month closing lows

http://www.livemint.com/2011/01/28153416/Markets-down-for-week-at-near.html?h=A2

Heavy govt spending likely in early FY12, says RBI

http://www.livemint.com/2011/01/27215622/Heavy-govt-spending-likely-in.html?atype=tp

India’s fiscal challenges

http://www.livemint.com/2011/01/27193143/India8217s-fiscal-challenge.html?atype=tp

Govt may infuse $3.3 bn into SBI via rights issue

http://www.livemint.com/2011/01/28153932/Govt-may-infuse-33-bn-into-S.html?h=A1

January 27, 2011

Soros warns euro crisis could divide Europe

Billionaire financier George Soros is warning that Europe could potentially fall apart because of a ``two-speed Europe that is being perpetuated by the reform of the embattled euro.

He told a news briefing Wednesday on the sidelines of the World Economic Forum that the currency used by 17 EU nations is in the process of reform following concerns over the debt crisis that enveloped Greece and Ireland and is threatening others.

But he said the reforms are not addressing the euro's real problem, that the currency has divided the richer EU countries from the poorer ones. Soros called for a European-wide stimulus that can spur growth in countries that have been left behind.

Otherwise, he said, ``Europe potentially could fall apart because of this two-speed Europe.

Trichet Signals EU Fund Could Buy Government Bonds

European Central Bank President Jean-Claude Trichet said governments could empower the region’s bailout fund to buy bonds, a step that would take pressure off the ECB’s efforts to fight the sovereign-debt crisis.

“There are a number of tools they can use and I would certainly not exclude that one, which I would consider useful in certain circumstances,” Trichet said in an interview with Bloomberg Television in Davos, Switzerland today.

European Union policy makers are scrambling to retool their 440 billion-euro ($602 billion) so-called European Financial Stability Facility before a summit of leaders in March. Trichet’s comments add weight to an ECB push for governments to buy bonds of the most distressed nations, a measure performed by the central bank since May and opposed by some council members. He didn’t exclude using the fund to recapitalize troubled banks.

For more on this, read at http://www.businessweek.com/news/2011-01-26/trichet-signals-eu-fund-could-buy-government-bonds.html

US federal deficit to hit record $1.5T

Far from slowing, the government's deficit spending will surge to a record $1.5 trillion flood of red ink this year, congressional budget experts estimated, blaming the slow economic recovery and last month's tax-cut law.

Daunting for President Barack Obama, the nonpartisan agency estimates a nationwide unemployment rate of 8.2 percent on Election Day in 2012.

The budget estimates will add fuel to the already-raging debate over spending and looming legislation that would allow the government to borrow more money as the national debt nears the $14.3 trillion cap set by law. Republicans controlling the House say there's no way they'll raise the limit without significant budget cuts, starting with a government funding bill that will advance next month.

For more on this, read at http://economictimes.indiatimes.com/news/international-business/us-federal-deficit-to-hit-record-15t/articleshow/7371074.cms

India food inflation at 15.57% y/y on Jan 15: Govt

India's food price index rose 15.57 percent and the fuel price index climbed 10.87 percent in the year to Jan. 15, government data on Thursday showed.

In the prior week, annual food and fuel inflation stood at 15.52 percent and 11.53 percent.

The primary articles price index was up 17.26 percent in the latest week, compared with an annual rise of 17.03 percent a week earlier.

The wholesale price index, the most widely watched gauge of prices in India, rose 8.43 percent in December from a year earlier, compared with 7.48 percent in November.

Banks Sell First Swiss Franc Bonds for 24 Years: India Credit

Indian banks are selling Swiss franc-denominated bonds for the first time in 24 years amid increasing European interest in emerging-market debt and after their dollar funding costs rose to a six-month high.

State Bank of India plans to issue Swiss currency notes after Union Bank of India raised 160 million francs ($170 million) on Jan. 14 from 4 1/2-year, 3.375 percent bonds. The average yield on Indian dollar bonds climbed to 5.23 percent on Jan. 24, from a record low 4.27 percent on Oct. 12, as Treasuries dropped on signs of a strengthening U.S. recovery.

“We have opened a new market for other Indian issuers,” V.K. Khanna, Union Bank’s general manager, said in an interview on Jan. 24. “We were able to save 30 to 35 basis points in interest costs over a similar issuance in dollars.”

For more on this, read at http://www.businessweek.com/news/2011-01-27/banks-sell-first-swiss-franc-bonds-for-24-years-india-credit.html

Outlook for 2011 US economy is brightening: Survey

Japan's Credit Rating Cut to AA- by S&P on Debt Load

http://www.bloomberg.com/news/2011-01-27/japan-s-debt-rating-lowered-to-aa-by-standard-poor-s-outlook-is-stable.html

Davos: finding common ground in a complex world

http://www.ft.com/cms/s/0/cdfa0bc4-2551-11e0-93ae-00144feab49a,dwp_uuid=750d9a14-254a-11e0-93ae-00144feab49a.html#axzz1CG2F9gj2

How the G20 can prevent another financial crisis

http://www.ft.com/cms/s/0/3172c19c-2556-11e0-93ae-00144feab49a,dwp_uuid=750d9a14-254a-11e0-93ae-00144feab49a.html#axzz1CG2F9gj2

A Nordic solution to Europe’s problems

http://www.ft.com/cms/s/0/a0f96368-2556-11e0-93ae-00144feab49a,dwp_uuid=750d9a14-254a-11e0-93ae-00144feab49a.html#axzz1CG2F9gj2

Davos consensus: we're out of the woods, but...

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23535

Business Investment Climbs, Housing Stabilizes

http://www.bloomberg.com/news/2011-01-27/orders-for-u-s-durable-goods-drop-2-5-increase-0-5-excluding-transport.html

AIG `Shouldn't Exist,' Ex-Chairman Says, Urging Breakup

http://www.bloomberg.com/news/2011-01-27/aig-shouldn-t-exist-ex-chairman-golub-says-urging-breakup-of-insurer.html

Markets at 4-½ mth closing low; banks drop

http://www.livemint.com/2011/01/27153012/Markets-at-4-mth-closing-low.html?h=A2

Banks to monitor MFIs more closely

http://www.livemint.com/2011/01/26203119/Banks-to-monitor-MFIs-more-clo.html?atype=tp

Central banks lack fiscal, farm support in inflation battle

http://www.livemint.com/2011/01/26194532/Central-banks-lack-fiscal-far.html?atype=tp

RBI warns of difficult times ahead

http://www.livemint.com/2011/01/26173743/RBIwarnsofdifficulttimesa.html?atype=tp

January 26, 2011

India with $1,000 per capita income ready for growth marathon

It may have happened in the middle of 2010. It may happen a month from now. Or, it may happen by the end of this year. The precise timing matters less than the implication of the achievement, India’s per capita income has either just about or will soon cross the $1,000-mark. In rupee terms, this translates into an average annual income of roughly Rs 45,000 for every Indian.

“The $1,000-income is the start of the take-off of a nation,” says Janmejaya Sinha, chairman, Asia Pacific, of consulting firm BCG. “It is around this number that a nation gets out of subsistence spending and moves more and more into higher quality branded product,” adds Chetan Ahya, MD, Research, Morgan Stanley .

China reached this threshold in 2003, and has since unleashed a consumption boom that the world is in awe of. Today, its per capita income is at $3,400.

For more on this, read at http://economictimes.indiatimes.com/news/economy/indicators/india-with-1000-per-capita-income-ready-for-growth-marathon/articleshow/7363966.cms

Davos discourse to focus on jobless economic growth

Over 2,500 global leaders, including 130 from India, are converging here on the snow-covered Alps to discuss for the next five days the future of the world economy, concerns of growth not creating enough number of jobs, particularly in rich nations.

The Geneva-based World Economic Forum (WEF) would be playing host to 1,400 from top 1,000 companies around the world, 30 heads of states or governments, renowned academicians, artists and the faith leaders, including head of the Chinmaya Mission in New Delhi.

The masters of the corporate world, governments and spiritual world and intellectual are meeting against a global economic environment which is yet to fully recover from the severe setbacks received in 2008 and 2009. The recovery in the developing world is largely driven by domestic demand but is quite considered fragile in the western economies.

For more on this, read at http://economictimes.indiatimes.com/news/international-business/davos-discourse-to-focus-on-jobless-economic-growth/articleshow/7364237.cms

King defends UK economic policy

The Bank of England has robustly defended the UK government’s economic strategy, urging it to stick to tough public spending cuts in spite of shock figures showing the inflation-prone economy shrunk at the end of last year.

For more on this, read at http://www.ft.com/cms/s/0/2585cc32-28ba-11e0-aa18-00144feab49a.html?ftcamp=rss#axzz1C4avIYqn

Subbarao Seeks Fiscal Restraint to Tame India Prices

India’s central bank urged the government to cut subsidies that are preventing inflation from easing as Governor Duvvuri Subbarao increased interest rates for the seventh time in a year.

“Monetary policy works most efficiently while dealing with an inflationary situation when the fiscal situation is under control,” Subbarao said yesterday after boosting the repurchase rate by a quarter-point to 6.5 percent.

Subbarao’s comments build pressure on Finance Minister Pranab Mukherjee to cut the budget deficit, which has almost doubled in three years. The Reserve Bank of India may also need to keep raising rates to quell inflation that remains the highest in the Group of 20 after Argentina and Russia.

For more on this, read at http://www.businessweek.com/news/2011-01-25/subbarao-seeks-fiscal-restraint-to-tame-india-prices.html

TARP Watchdog Says Success Damaged by ‘Moral Hazard’

U.S. taxpayer-funded bailouts are “a study in contrasts” marked by both financial success and the risks involved in propping up companies deemed too big to fail, a government watchdog said.

The rescues prevented “a catastrophic financial collapse” in 2008, according to a report today from Neil Barofsky, special inspector general for the Troubled Asset Relief Program. The non-financial costs include “damage to the government’s credibility that has plagued the program” and “the failure of programs designed to help Main Street rather than Wall Street.”

The Congressional Budget Office, which at one point estimated TARP would cost $350 billion, has lowered its projection to as little as $25 billion. That figure is “too high in my judgment,” Treasury Secretary Timothy F. Geithner said last month. Of the $700 billion Congress authorized for TARP in 2008, $410 billion has been disbursed.

For more on this, read at http://www.businessweek.com/news/2011-01-25/tarp-watchdog-says-success-damaged-by-moral-hazard-.html

Brent Oil’s Record Open Interest Threatens WTI: Energy Markets

Rising purchases of Brent crude contracts have driven holdings of the European benchmark oil grade to the highest level in five months relative to New York futures as investors bet it’s a better gauge of global demand.

Open interest, the number of contracts that haven’t been closed or delivered, for Brent futures rose to a record 968,565 on Jan. 21, data from London-based ICE Futures Europe show. The ratio of the European marker to West Texas Intermediate oil positions on the New York Mercantile Exchange climbed to 65 percent, 15 percentage points above the five-year average and the most since Aug. 2, according to data compiled by Bloomberg.

Investors are piling into Brent as new supplies from Canada build up at the U.S. oil hub in Cushing, Oklahoma, skewing its reliability as an indicator of demand because of the lack of pipelines to the sea. TransCanada Corp.’s Keystone link may pump as much as 156,000 barrels of crude to Cushing from next month, according to Vienna-based JBC Energy GmbH. Cushing is the delivery point for Nymex futures.

For more on this, read at http://www.businessweek.com/news/2011-01-25/brent-oil-s-record-open-interest-threatens-wti-energy-markets.html

Chinese Banks Raise Rates as Much as 45%, Paper Says

Some Chinese banks have raised lending rates to as much as 45 percent higher than the benchmark level to rein in credit growth, the official China Securities Journal reported today.

One large commercial lender has told branches to charge between 10 percent and 45 percent more, depending on which industries borrowers are in, the newspaper said, citing an unidentified official from the bank. China’s benchmark one-year rate is 5.81 percent. The report didn’t name the lender.

The surge in lending typical of the start of each year may be hampering government efforts to rein in liquidity, cool inflation and prevent asset bubbles. This month’s lending reached 1.2 trillion yuan ($182 billion) by Jan. 24, according to a China Business News report today citing an unidentified person. That would compare with 481 billion yuan last month.

For more on this, read at http://www.businessweek.com/news/2011-01-25/chinese-banks-raise-rates-as-much-as-45-paper-says.html

Fed likely to keep $600B bond-purchase plan intact

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23459

Greece Default With Ireland to Break Euro by 2016 in Global Investor Poll

http://www.bloomberg.com/news/2011-01-25/greece-default-with-ireland-breaks-euro-by-2016-in-global-poll.html

IMF warns of euro zone risk to global economy

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23464

China shows appetite for EFSF bond issue despite official's note of caution

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23465

Davos forum: Is China still an emerging economy?

http://www.garp.org/news-and-publications/overview/story.aspx?newsId=23458

Sales of New Homes in U.S. Rose More Than Forecast

http://www.bloomberg.com/news/2011-01-26/sales-of-new-homes-in-u-s-rose-more-than-forecast-in-december-up-18-.html

RBI raises rates to fight inflation

http://www.livemint.com/2011/01/26000245/RBI-raises-rates-to-fight-infl.html?h=A1

Rates up, RBI still behind the curve

http://www.livemint.com/2011/01/25224545/Rates-up-RBI-still-behind-the.html?atype=tp

Over to fiscal policy to tackle inflation

http://www.livemint.com/2011/01/25214019/Over-to-fiscal-policy-to-tackl.html?h=A2

RBI concerned about high credit growth

http://www.livemint.com/2011/01/25211108/RBI-concerned-about-high-credi.html?atype=tp

RBI highlights macro risks

http://www.livemint.com/2011/01/25211140/RBI-highlights-macro-risks.html?atype=tp

Sensex closes below 19,000 on central bank rate hikes

http://www.livemint.com/2011/01/25215454/Sensex-closes-below-19000-on.html?atype=tp

Govt looking at allowing FDI in retail and defence: Scindia

http://www.livemint.com/2011/01/25235022/Govt-looking-at-allowing-FDI-i.html?atype=tp

January 25, 2011

Indian rupee weakens tracking euro; shares limit fall

The Indian rupee weakened on Monday, weighed by losses in the euro versus the dollar but gains in domestic shares helped limit further downside.

The partially convertible rupee closed at 45.67/68 per dollar, weaker from 45.615/625 at close on Friday when it touched a seven-week low of 45.77.

"There were not much flows in the market today, rupee was just tracking the euro. Policy is not likely to have any direct impact on the spot market, rupee will react to the move in equities tomorrow," said Rohan Naik, head of foreign exchange trading at Standard Chartered Bank .

The euro backed off a two-month high against the dollar on Monday after an early burst of buying ran out of steam, while political turmoil in Ireland highlighted uncertainties facing heavily indebted euro zone countries.

The dollar index, a measure of the greenback's performance against six major currencies, was up 0.3 per cent at 78.442 points when the rupee market closed.

For more on this, read at http://economictimes.indiatimes.com/markets/forex/indian-rupee-weakens-tracking-euro-shares-limit-fall/articleshow/7355975.cms

India needs solution to $1.5 trillion puzzle

India needs a solution to a $1.5 trillion-plus puzzle. That's what it will need to invest in infrastructure over the next decade if it is to have any hope of achieving its aspiration of 10 percent GDP growth. The government and banks, India's traditional sources of infrastructure funding, won't be able to carry that load on their own. Financial liberalisation, something the country has hitherto shied away from, could help fill the gap.

Poor infrastructure is one of the main things holding India back. Poor logistics cause waste equivalent to 5 percent of GDP, according to McKinsey. Roads such as the "golden quadrilateral", joining the country's biggest four conurbations, are being laid down, but not rapidly enough. No wonder the roads minister was shifted in a cabinet reshuffle earlier this month.

An estimated one-third of all fresh produce spoils before it reaches the market, and most of the country's railways predate independence in 1947. There are chronic electricity shortages in most states. And then there are the heaving cities, suffering from poor sanitation and virtually bereft of mass public transport.

For more on this, read at http://economictimes.indiatimes.com/news/economy/finance/india-needs-solution-to-15-trillion-puzzle/articleshow/7353309.cms

Sensex may return 10% as it's set to touch 21K: Deutsche Bank

Global investment major Deutsche Bank expects the 30-share Sensex to touch 21000 by December this year, implying 10% returns from current levels.

While inflation and mounting raw material prices continue to haunt the domestic market , rising rural prosperity, high aspiration levels among city-folks and buoyant consumption will work in favour of Indian companies, said Deutsche Bank in a note to its clients.

       “The Indian market, in our view, is set to face a gale of headwinds in the short term. 

We remain convinced about the long-term India investment story,” the Deutsche Bank note said, adding,

       "For long-term investors, a downdraft in the short term will be an excellent opportunity to pick value.” 

For more on this, read at http://economictimes.indiatimes.com/markets/analysis/sensex-may-return-10-as-its-set-to-touch-21k-deutsche-bank/articleshow/7357735.cms

Nifty expected to trade in 5600-5850 range

A day before the D-Day, the Nifty closed 46 points up, moved primarily by banking counters, particularly ICICI Bank and SBI .

All eyes are now on the RBI policy meet scheduled on Tuesday. Expectation is that there may be a 25-bp hike each in repo (current 6.25%) and reverse repo (5.25%). Succeeding hikes in petrol prices and continuous postponement of the EGOM meet to decide over diesel price hike, combined with a rally in crude prices during the past few weeks have accentuated the importance of Tuesday’s RBI policy action.

Critics on the Street, however, argue that this may not be the answer as the borrowing rates in the money market for banks are already higher than those for the government.

Through the expiry we observed that traders preferred not to take overnight positions in the Nifty as the market remained choppy. The indecisiveness in the market is also hinted by T-2 Nifty rollovers at 31%, compared with the 3-month average of 41%. Among sectors, T-2 rollovers in metals was at 37%, compared with the 3-month average of 45% and auto was at 34%, compared with 46%, which were sluggish.

For more on this, read at http://economictimes.indiatimes.com/markets/analysis/nifty-expected-to-trade-in-5600-5850-range/articleshow/7357780.cms

Too-Big-To-Fail Regulations Vex Lenders, Oudea Says

Societe Generale SA Chief Executive Officer Frederic Oudea said global plans to list banks deemed systemically important and make them hold extra capital may backfire by creating more lenders that are too big to fail.

Banks have “real concerns” about the Financial Stability Board and other regulators “designating groups of firms” as systemically important, said Oudea, adding that lenders are also seeking changes to liquidity rules drawn up by the Basel Committee on Banking Supervision.

Oudea’s made his remarks today as bank executives including Deutsche Bank AG’s CEO Josef Ackermann and JPMorgan Chase & Co.’s CEO Jamie Dimon are set to gather this week with lawmakers and regulators from around the world at the World Economic Forum in Davos, Switzerland. Societe Generale, France’s second-largest bank by market value, will be represented in Davos by Deputy CEO Bernardo Sanchez Incera.

For more on this, read at http://www.businessweek.com/news/2011-01-24/too-big-to-fail-regulations-vex-lenders-oudea-says.html

Spain Says Bank Shortfall Won’t Exceed $27 Billion

Spanish Finance Minister Elena Salgado said the amount needed to recapitalize the country’s banking system won’t exceed 20 billion euros ($27 billion) and “all or part” of that sum will come from financial markets.

Spain will also make lenders adopt a core capital ratio of at least 8 percent, Salgado said in a news conference in Madrid today. Lenders will have until the fall to raise enough capital to meet that requirement, and those that can’t do so will be able to tap the state’s bank-rescue fund known as FROB, which will take ordinary shares with voting rights in exchange.

The figure is lower than estimates from analysts including those at Moody’s Investors Service, which said today that lenders may need at least 17 billion euros, rising to 89 billion euros in a stressed case. Savings banks, or cajas, have been locked out of wholesale debt markets amid investor concern about 181 billion euros of what the Bank of Spain terms “potentially troubled exposure” to construction and real estate.

For more on this, read at http://www.businessweek.com/news/2011-01-24/spain-says-bank-shortfall-won-t-exceed-27-billion.html

BRIC Inflation Imperils Consumer Stocks as Food Rises

Emerging-market consumer companies are valued at the most expensive levels on record just as surging food and energy costs curb household spending from Sao Paulo to Shanghai.

Shares in the MSCI Emerging Markets Consumer Discretionary Index traded at a 15-year high of 2.6 times net assets last week, data compiled by Bloomberg show. Wynn Macau Ltd., owned by billionaire Stephen Wynn’s casino company, fetched a record 28 times forecast profit. Mahindra & Mahindra Ltd., India’s biggest sport-utility vehicle maker, has a price-to-book ratio 53 percent higher than global peers, while Brazil’s Cia. Hering, producer of Hering brand apparel, commands a 15 percent premium.

Economic growth and supply shortages sent a United Nations gauge of food prices to a record last month, cutting the buying power of 2.8 billion people in Brazil, Russia, India and China who spend 19 percent of their income on groceries, compared with 6 percent in the U.S., Euromonitor International data show. Consumer shares were the second-worst performers among 10 industries in periods of rising inflation since 2001, according to Morgan Stanley.

For more on this, read at http://www.businessweek.com/news/2011-01-24/bric-inflation-imperils-consumer-stocks-as-food-rises.html

Bank of Japan Raises Fiscal 2010 GDP Forecast to 3.3%

The Bank of Japan raised its growth forecasts for this fiscal year as strong overseas demand supports the economy.

Policy makers predicted an expansion of 3.3 percent in the year ending March 31 compared with the 2.1 percent estimated in October, the central bank said in a statement today in Tokyo. The BOJ also held the key interest rate between zero and 0.1 percent and the size of a program to buy securities at 5 trillion yen ($60 billion), by a unanimous vote.

The BOJ’s more optimistic view was in line with the government’s 3.1 percent expansion forecast, as accelerating growth in Japan’s largest overseas markets helped boost output. Still, the risk of a further yen appreciation hurting exports and worsening deflation leaves open the possibility of the BOJ expanding its stimulus steps, HSBC Securities said.

For more on this, read at http://www.businessweek.com/news/2011-01-24/bank-of-japan-raises-fiscal-2010-gdp-forecast-to-3-3-.html

Bank of America’s Countrywide Accused in Suit of ‘Massive Fraud’

Bank of America Inc.’s Countrywide Financial unit, acquired by the bank in 2008, was accused of “massive fraud” in a lawsuit by investors who claim they were misled about mortgage-backed securities.

TIAA-CREF Life Insurance Co., New York Life Insurance Co. and Dexia Holdings Inc. are among a dozen institutional investors who filed the complaint yesterday in New York state Supreme Court.

The investors claim they bought hundreds of millions of dollars of Countrywide mortgage-backed securities from 2005 to 2007 because they wanted conservative, low-risk investments. They said they relied on term sheets, prospectuses and other materials provided by the firm that were recklessly or knowingly false.

For more on this, read at http://www.businessweek.com/news/2011-01-25/bank-of-america-s-countrywide-accused-in-suit-of-massive-fraud-.html

Fed Likely to Press On With QE Even as Business Lending Rises

The Federal Reserve will probably push forward with $600 billion in securities purchases even as the biggest jump in business loans in more than two years adds to signs the U.S. economy is gaining strength.

Commercial and industrial loans increased at an annual rate of 7.6 percent last month, the largest gain since October 2008, according to Fed data. Total bank credit has risen in three of the past six months as business loans cushioned against declines in real estate and consumer credit.

Bernanke and his fellow policy makers will probably note improvements in the economy such as higher consumer spending in a statement to be released tomorrow, former Fed governor Lyle Gramley said. Encouraging signs like firmer bank credit are unlikely to prompt a reduction in stimulus so long as growth remains weak and unemployment persists near 10 percent, he said.

For more on this, read at http://www.businessweek.com/news/2011-01-25/fed-likely-to-press-on-with-qe-even-as-business-lending-rises.html

India raises rates in inflation fight

India has responded to persistently high inflation and an economy exceeding its growth forecasts by continuing its aggressive campaign of raising interest rates.

Reserve Bank of India governor Duvvuri Subbarao spared consumers from a steep rise in interest rates as he fears they may be heading towards getting whipsawed by moderating growth and poorer macro fundamentals next fiscal.

Subbarao raised policy rates by 25 basis points meeting market expectations and raised inflation forecast for the fiscal by 150 basis points to 7%, drawing criticism that prognosis and policy are not in sync. A basis point is 0.01 percentage point. Rate increases won’t stop till price rise slows, but liquidity will be maintained.

For more on this, read at http://www.ft.com/cms/s/0/14f932b2-2849-11e0-bfcc-00144feab49a.html?ftcamp=rss#axzz1C4avIYqn

http://economictimes.indiatimes.com/news/economy/policy/cautious-rbi-raises-key-rates-by-25-bps/articleshow/7364030.cms

RBI sees economic growth moderating in 2011-12

The Reserve Bank of India on Tuesday said India's economic growth rate will moderate in the next financial year, even as it retained the forecast for the current fiscal at 8.5 per cent with an upward bias.

"Looking beyond 2010-11, the Reserve Bank expects domestic growth momentum to stabilise, though the GDP growth rate may decline somewhat, as agriculture reverts to its trend (assuming a normal monsoon)," the central bank said in its third quarter review of monetary policy.

As regards inflation, the RBI said that it would ease in the first quarter of the next fiscal (2011-12) but added that several upside risks are already visible in the global environment and more may surface domestically.

For more on this, read at http://economictimes.indiatimes.com/news/economy/indicators/rbi-sees-economic-growth-moderating-in-2011-12/articleshow/7360203.cms

Euro Falls on Renewed Debt Concern; Pound Slides as GDP Shrinks

The euro fell from the highest level since November against the dollar on renewed concern governments may struggle to contain the sovereign-debt crisis.

Sterling dropped the most in a month as the U.K.’s gross domestic product unexpectedly shrank in the fourth quarter. The yen and Swiss franc rallied versus most of their major counterparts as stocks fell on the U.K.’s contraction. Spain’s Finance Minister Elena Salgado said yesterday the nation’s lenders will need no more than 20 billion euros ($27 billion) of extra capital, lower than a Moody’s Investors Service estimate of 89 billion euros.

For more on this, read at http://www.businessweek.com/news/2011-01-25/euro-falls-on-renewed-debt-concern-pound-slides-as-gdp-shrinks.html

Gold's dream climb expected to plateau in 2012

Gold should build on last year's stellar gains in 2011 to hit record highs, boosted by low interest rates, dollar weakness and lingering worry over growth in major economies, a poll showed on Tuesday.

But prices could plateau in 2012 as the global economy gathers momentum, quantitative easing measures that have flooded the markets with cheap money are reined in and interest rates turn higher, analysts say.

For more on this, read at http://economictimes.indiatimes.com/markets/commodities/golds-dream-climb-expected-to-plateau-in-2012/articleshow/7362563.cms

January 24, 2011

Euro's Slide Meets Resistance as Analysts Draw Line at $1.30

Traders are starting to believe German Chancellor Angela Merkel when she says Europe’s biggest economy will do whatever it takes to save the region’s currency.

Demand for contracts used to hedge against a decline in the euro is disappearing at the fastest pace since September as speculators slash bets that the currency will fall, a pattern that preceded a 13 percent gain over about two months. Strategists have stopped cutting their estimates for the euro against the dollar, with their fourth-quarter predictions at $1.30 since Jan. 10, according to data compiled by Bloomberg.

Since then, the euro rose 5.5 percent to $1.3576 as of 8:56 a.m. in London from a four-month low of $1.2867 as Germany joined euro-area finance ministers for the first time in saying it’s contemplating expanding a financial backstop that Economic and Monetary Affairs Commissioner Olli Rehn said will repel the most aggressive speculators. A bigger safety net would free European Central Bank President Jean-Claude Trichet to fight an emerging inflation threat as Germany fuels regional growth.

For more on this, read at http://www.bloomberg.com/news/2011-01-24/euro-bears-retreating-from-merkel-pledge-as-strategists-draw-line-at-1-30.html

Halliburton Profit Rises as Oil Prices Boost Demand

Halliburton Co., the world’s second- largest oilfield services provider, said profit more than doubled as higher crude prices and demand for drilling equipment boosted sales in North America.

Fourth-quarter net income rose to $605 million, or 66 cents a share, from $243 million, or 27 cents, a year earlier, Halliburton said in a statement today. Excluding costs from a settlement agreement with Nigeria, the Houston-based company earned 5 cents more than the average of 33 analysts’ estimates compiled by Bloomberg.

Halliburton’s North American sales, its largest source of revenue, rose 83 percent to $2.63 billion even as its Gulf of Mexico operations reported a loss. Recovery in the number of rigs operating in the Gulf after BP Plc’s oil spill is “uncertain” this year, Halliburton said.

For more on this, read at http://www.businessweek.com/news/2011-01-24/halliburton-profit-rises-as-oil-prices-boost-demand.html

Citigroup Bailout Warrants Will Be Auctioned by U.S.

The U.S. Treasury Department announced plans to auction warrants in Citigroup Inc. received as part of the bank’s $45 billion rescue during the financial crisis.

The sale will take place tomorrow with Deutsche Bank Securities Inc. as the auction agent, according to a statement today from Treasury. The government will sell 255 million A warrants with a minimum bid price of 60 cents and 210 million B warrants with a minimum bid of 15 cents, the statement said.

Banks that participated in the Troubled Asset Relief Program had to give the Treasury warrants to compensate taxpayers for supporting the financial system. The warrants gave holders the option to buy shares at a specified price for 10 years. Lenders have the right make an offer to buy back the warrants; if the price is too low, the Treasury auctions them to defray costs of the $700 billion bailout program.

For more on this, read at http://www.businessweek.com/news/2011-01-24/citigroup-bailout-warrants-will-be-auctioned-by-u-s-.html

Barclays Said to Plan Bonds for Banker Bonus Payments

Barclays Plc, the third-biggest U.K. lender, may pay part of the bonuses for 1,000 or more of its most senior bankers in bonds that convert into equity if the company’s capital shrinks, two people briefed on the talks said.

Chief Executive Officer Robert Diamond is weighing plans to use bonds similar to contingent convertibles, or CoCos, to pay some of the bonuses granted to managing directors and other senior bankers, said the people, who declined to be identified because the talks are private. The plan has yet to be approved by the U.K.’s Financial Services Authority, said the people.

“You’re taking disposable cash away from your employees, so they aren’t going to be very happy,” said Jason Kennedy, chief executive officer of Kennedy Group, a London-based recruitment firm. “Without knowing the details of the convert, it’s difficult to know how positive or negative the deal is.”

For more on this, read at http://www.businessweek.com/news/2011-01-24/barclays-said-to-plan-bonds-for-banker-bonus-payments.html

Euro Bears Retreating From Merkel Pledge as Strategists Draw Line at $1.30

Traders are starting to believe German Chancellor Angela Merkel when she says Europe’s biggest economy will do whatever it takes to save the region’s currency.

Demand for contracts used to hedge against a decline in the euro is disappearing at the fastest pace since September as speculators slash bets that the currency will fall, a pattern that preceded a 13 percent gain over about two months. Strategists have stopped cutting their estimates for the euro against the dollar, with their fourth-quarter predictions at $1.30 since Jan. 10, according to data compiled by Bloomberg.

Since then, the euro rose 5.5 percent to $1.3576 as of 8:56 a.m. in London from a four-month low of $1.2867 as Germany joined euro-area finance ministers for the first time in saying it’s contemplating expanding a financial backstop that Economic and Monetary Affairs Commissioner Olli Rehn said will repel the most aggressive speculators. A bigger safety net would free European Central Bank President Jean-Claude Trichet to fight an emerging inflation threat as Germany fuels regional growth.

For more on this, read at http://www.bloomberg.com/news/2011-01-24/euro-bears-retreating-from-merkel-pledge-as-strategists-draw-line-at-1-30.html

ECB to Keep Rate on Hold Until 4Q on Banks, Goldman Sachs Says: Tom Keene

The European Central Bank probably won’t raise interest rates before the fourth quarter, even as inflation accelerates, because of the region’s weak banking industry, according to Goldman Sachs Group Inc. chief interest- rate strategist Francesco Garzarelli.

“What seems to be holding the ECB’s hands at the present juncture is the concern over insolvencies of some of these banking institutions,” Garzarelli said in an interview on “Bloomberg Surveillance” with Tom Keene. “Ultimately, those issues will be addressed by the governments and that will relinquish the ECB from having to handle the problem, so they can return to looking at inflation as their primary mandate.”

Goldman predicts that the central bank will increase the borrowing cost in the October-December period. The ECB kept its benchmark rate at a record low of 1 percent earlier this month while President Jean-Claude Trichet toughened his rhetoric on inflation after it accelerated to 2.2 percent in December, breaching the central bank’s 2 percent limit for the first time in more than two years.

For more on this, read at http://www.bloomberg.com/news/2011-01-24/ecb-to-keep-rate-on-hold-until-4q-on-banks-goldman-sachs-says-tom-keene.html

Fed to go easy on applause

Federal Reserve Chairman Ben Bernanke may have to muffle his applause for the sturdier U.S. economic recovery.

The unemployment rate is finally edging lower and figures due on Friday are expected to show economic growth strengthened over the final three months of 2010. But the Fed may provide only a slightly more upbeat economic assessment at its next policy-setting meeting, which wraps up on Wednesday.

The central bank's word choices are always parsed and scrutinized. This week's statement will be particularly tricky because the Fed will need to acknowledge the improving economic data without sending a false signal that its $600 billion bond-buying program could end early.

But if Bernanke and company are too sparing in describing the recovery's progress, that could be interpreted as a lack of faith that this latest burst of economic vigor will last.

For more on this, read at http://www.reuters.com/article/idUSTRE70M1ZM20110123

Maybe Japan was just a warm up to US’ rivalry with China

In the 1980s, the US faced an unnerving challenge from a rising economic powerhouse and export dynamo. It was an impressive challenger, to be sure, but one that often bent rules of global competition unfairly to its advantage by handing out financial subsidies to domestic companies, discriminating against foreign suppliers in government contracts, pilfering Western technology and keeping its currency cheap.

Three decades later, Americans are hearing an echo of the past. Yet this time, the object of admiration and angst is not Japan Inc., but China Inc.

“We’ve seen this movie before,” says Clyde V. Prestowitz Jr, president of the Economic Strategy Institute and a former US trade negotiator with Japan in the 1980s. “Like Japan, China is climbing up the ladder of economic and technological development, and using every means at its disposal to do so.”

For more on this, read at http://www.livemint.com/2011/01/23212423/Maybe-Japan-was-just-a-warm-up.html?atype=tp

RBI warns on inflation risk; rate rise seen

The Reserve Bank of India (RBI) said inflation may stay high for longer than earlier anticipated due to a rise in global commodities prices and domestic supply pressures that have pushed up food prices.

Monday’s report appeared to reinforce the likelihood that the RBI will lift policy interest rates by at least 25 basis points at its quarterly review on Tuesday. The central bank also said downside risks to growth had receded.

For more on this, read at http://www.livemint.com/2011/01/24163437/RBI-warns-on-inflation-risk-r.html?h=A1

Time to tighten monetary bolts

The only question worth debating a couple of days before Reserve Bank of India (RBI) governor D. Subbarao announces his next move on Tuesday is: should he increase policy interest rates by 25 or 50 basis points? The authorities have been fighting a losing battle against inflation and stern action is required if matters are not to spin out of control. Central bank data shows that households now expect inflation to be in the double digits even one year down the line. Such elevated inflation expectations could lead to a wage hike spiral in the next fiscal, despite the fact that trade unions no longer have the power they once used to. Inflation expectations need to be anchored quickly. Despite the current focus on the price of onions, Indian inflation is no longer restricted to food. It has spread to industrial goods many months ago. That continues to be the biggest immediate threat to the Indian economy right now, with a widening current account deficit not far behind. Yet, the economy is not overheated to the extent it was in 2008, going by various indicators such as bank credit growth, money supply growth and asset prices. Also, there are some signs that the monetary tightening in 2010, when the effective policy interest rates moved up by 300 basis points, is having an impact on consumer demand (though inflation could also be a factor here as budget-constrained consumers have postponed some purchases to make way in their household budgets for more expensive food).

For more on this, read at http://www.livemint.com/2011/01/23194011/Time-totighten-monetary-bolts.html?atype=tp

ICICI Bank posts Rs1,437 cr net profit in Q3

ICICI Bank Ltd, India’s largest private sector lender, reported a net profit of Rs1,437 crore for the December quarter, up 30.51% from Rs1,101 crore earned in the corresponding quarter in the previous year.

The earnings beat a Bloomberg estimate which had forecast a net profit of Rs1,360 crore for the period.

Net interest income or the core income for the bank increased 12.32% to Rs2,311.7 crore from Rs2,058.1 crore last year.

The bank’s stock rose 0.94% to Rs1,076 a share on the Bombay Stock Exchange (BSE) in line with a 0.55% rise in the benchmark 30-share Sensex.

A fall in provisions to Rs464 crore from Rs1,002 crore last year added to the bank’s profitability.

For more on this, read at http://www.livemint.com/2011/01/24130542/ICICI-Bank-posts-Rs1437-cr-ne.html?h=A1

Clean-up of financial laws coming

THE Union cabinet will soon take up for discussion a proposal to create the Financial Sector Legislative Reforms Commission (FSLRC), to rewrite and clean up the financial sector laws of the country.

   “The proposal has been finalised.... It could go to cabinet in a week,” said an official privy to the matter. 

Several expert panels appointed by the government in the past on financial sector regulation, including the Raghuram Rajan Committee, the Percy Mistry Committee and the UK Sinha Committee, had emphasised on the need to rewrite India’s financial sector laws to bring them in line with the current needs. Finance Minister Pranab Mukherjee had in his 2010 Budget announced the government’s intention to establish FSLRC to simplify and streamline the legal framework and possibly suggest a completely new regulatory structure for the sector.

For more on this, read at http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/01/24&PageLabel=1&EntityId=Ar00104&ViewMode=HTML

Spectrum: For cash or growth?

What is common to Canary Wharf, Metro PCS and Global Crossing? All three were established with ambitious plans at the cusp of an asset bubble — London real estate, metropolitan wireless spectrum in the US, and global fiber optic cable systems, respectively. At the time their potential for growth seemed almost limitless. But they quickly went into bankruptcy or reorganisation when the bubble burst. What distinguishes these examples, however, is that bankruptcy was not the end of the road for them. They emerged with leaner operations and lower debt than competitors who chose not to follow that path — a significant cost advantage that allowed their new owners to reap rich rewards over time. Will telecom assets in India relive this dubious history?

There’s been much debate about the efficacy of auctions as a method to discover the true market value of wireless spectrum that appears to be in short supply. When compared with the alternative of an administered price, auctions do seem more transparent and less prone to manipulation.

But two observations ring a cautionary note. First, how should the government seek to balance the shortterm gains from auction proceeds with the longer-term socio-economic benefits? A study jointly carried out late last year by The Boston Consulting Group and the GSM Association on the benefits of re-farming the 700 MHz band for mobile broadband estimates $68 billion of incremental GDP in India till 2020 from, among other things, the creation of over 3,00,000 new jobs, 1,38,000 new businesses and 14 million additional rural internet households. But these benefits only accrue when the deployment of network and services is broad-based.

For more on this, read at http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETKM/2011/01/24&PageLabel=12&EntityId=Ar01201&ViewMode=HTML

January 23, 2011

Bankers expect up to 50 bps hike in policy rates

High food inflation is most likely to weigh on the Reserve Bank of India (RBI), which is widely expected to raise key policy rates by at least 25 basis points (bps) in its monetary review due on Tuesday, top bankers said.“Conventional wisdom says that there should be at least 25 basis point hike in interest rate,” said State Bank of India chairman OP Bhatt. Despite moderating for two weeks, food inflation is still very high at 15.52% on account of rising prices of essential items like vegetables, particularly onion and tomato, fruits, milk and eggs.Finance minister Pranab Mukherjee had expressed concern over food inflation saying, “some of the vegetable prices are still high.” Though analysts are not sure whether any further tightening of interest rate can check the price rise, the central bank seems to have few options but to hike rates.It is to be noted that RBI chose not to tinker with the policy rates during the last review in December even though food inflation was in double digits.The stubbornly high food inflation rate may prompt RBI to tighten money supply by raising both short-term lending (repo) and borrowing (reverse repo) rates.Endorsing the widespread view, HDFC Ltd chairman Deepak Parekh said RBI is expected to raise key short-term rates by 25-50 basis points.

For more on this read at: http://www.livemint.com/2011/01/23115215/Bankers-expect-up-to-50-bps-...

Tata Steel's Public Offer Covered Six Times

Tata Steel Ltd.'s 34.77 billion rupees ($762.5 million) public offering was subscribed nearly six times the shares on offer with an hour to go on the final day of the share sale Friday, as investors put in bids to take part in the Indian steelmaker's growth story.Most investors usually wait until the final day of a public issue to put in their bids due to rules that they must pay the entire bid amount up front, a change from the earlier practice of only paying a fraction up front.Investor faith in the world's seventh-largest steelmaker by capacity will boost the confidence of Tata Steel's management, which was saddled with $10.7 billion of net debt as of Sept. 30 and wanted to cut some of that using the proceeds from the share sale. The issue of 48.68 million shares, which opened Wednesday, received bids for nearly 290.67 million shares, or 5.97 times the shares on offer, data on the National Stock Exchange showed at 1130 GMT. Investment bankers involved in the share sale said the institutional book was covered 10.41 times while the section reserved for wealthy individuals was subscribed 7.21 times. The retail book was still open but was covered 1.46 times, the bankers said.

For more on this read at: http://online.wsj.com/article/SB1000142405274870475430457609527273074...

Spain to Ramp Up Bailout of Banks

Dave Kansas reports Spain, at the direction of president Rodriguez Zapatero, will pour billions more euros into its ailing savings banks in an effort to force them to be more open about lending practices.

In a first step, Spain is preparing to issue €3 billion ($4 billion) in debt in coming days, the people familiar with the matter said. Government officials are putting plans in place to eventually raise as much as €30 billion, according to these people, though some say the final tally will be less. The hope is that a series of capital injections will quell investor jitters about the savings banks, known as cajas (literally, "boxes"), which have been a thorn in Spain's side as it seeks to convince investors that the country's finances are stable.

The fate of the cajas is inextricably tied to the fate of Spain and potentially to the euro itself. Fear that the savings banks can't raise funds on their own and will need a government bailout was one reason ratings agency Moody's put Spain's rating on review for a downgrade last month. Another step the government is taking to boost investor confidence in the cajas is simplifying their complex structures, making them more like traditional banks. The cajas have long had confusing ownership and governance structures and disclosed far less financial information than other banks. Their boards consisted of local politicians, union members, clients and, in some cases, Catholic priests, many of whom were reluctant to relinquish their influence over lending decisions.

For more on this read at: http://online.wsj.com/article/SB1000142405274870395170457609213324888...

Trichet Expects EU to Agree on More Automatic Enforcement of Budget Rules

European Central Bank President Jean-Claude Trichet expects the European Union to agree on more automatic sanctions for violations of its budget rules. “I hope very much and I would say I expect that this governance will be reinforced and that the quasi-automaticity for the start of the adjustment procedure and for the sanctions will be incorporated in the future governance,” Trichet said in an interview with Dutch television program “Buitenhof” broadcast today. ECB policy makers are increasing the pressure on governments to adopt stricter rules after swelling budget deficits helped trigger Europe’s sovereign-debt crisis, which so far has forced bailouts of Greece and Ireland. EU governments plan to sign off on their version of revamped crisis-fighting- rules by the end of March. Separately, Trichet said officials have to be “alert” to avoid second-round effects on inflation. “When you have such increase of commodity prices you have an immediate increase of CPI, which is unavoidable of course,” he said. European inflation accelerated to the fastest pace in more than two years in December, led by surging energy costs, complicating the ECB’s efforts to deal with the sovereign debt crisis. Inflation quickened to 2.2 percent in December, the fastest since October 2008. “What is important for us is to avoid that there is any increase of the other prices that would create a problem for price-stability in the medium term,” Trichet said. When asked about a possible debt restructuring by Portugal, Greece or Ireland this year, Trichet said “this not the assumption that we have in mind.”

For more on this read at: http://www.bloomberg.com/news/2011-01-23/trichet-expects-eu-to-agree-...

Greek Finance Minister Aims to Avoid Restructuring, Eleftherotypia Reports

Greece will avoid restructuring its debt by creating primary surpluses, implementing major structural changes and achieving an annual real growth rate of above 2 percent a year, Finance Minister George Papaconstantinou told Eleftherotypia newspaper. An extension of the maturities of the loans under the 110 billion-euro ($150 billion) European Union-led bailout fund will also help, as will “more favorable financing terms in the framework of the new European decisions that will be taken,” Papaconstantinou said in an interview published today. The minister said he continued to plan to return to markets this year for financing and said a first test would be the issuance of a so-called diaspora bond over the next few months, aimed at Greeks living in Europe, the U.S. and Australia, according to the newspaper. The retail bond would offer a yield below current market rates, he was cited as saying.

For more on this read at: http://www.bloomberg.com/news/2011-01-23/greece-aims-to-avoid-restruc...

Don't rule out debt buy-back idea

European leaders should not shy away from a proposal to buy back the bonds of troubled euro member states but should not rely too much on rich countries, Eurogroup Chief Jean-Claude Juncker said. "It would be wrong to create taboos but we cannot overstretch the strong countries," Juncker said in an interview with German magazine Der Spiegel seen by Reuters on Saturday ahead of publication. A source told Reuters on Thursday that euro zone ministers are considering whether the bloc's rescue fund could buy back bonds of debt-ridden states, a plan Portugal said it supported. Der Spiegel magazine also reported in an unsourced reported that the idea of a buy-back, which it said was first raised by the European rescue fund's chief Klaus Regling, had been greeted with sympathy by euro zone finance ministers this week. Without citing any sources, Der Spiegel said Regling's suggestion stood good chances of becoming reality. "The measure has good prospects of being signed off as part of a comprehensive package to stabilize the euro zone at the European Council in March," it said in a pre-publication release. It also cited an unnamed high-ranking German finance ministry source as saying this was a good idea, running counter to official German denials this week. "I wouldn't know of anyone in the Finance Ministry who would have said that," a spokesman for the ministry told Reuters, declining to comment on the Der Spiegel report. Greece and Germany have insisted Greece, the first to succumb in the currency bloc's debt crisis, needed no help with debt repayments. A spokesman for EFSF's Regling declined comment but referred to an interview earlier this week in which he said Greece did not need a restructuring of debt, while the Greek finance ministry again denied there have been any discussions on restructuring.

For more on this read at: http://www.reuters.com/article/idUSTRE70L15X20110123

Bank of America must be hoping for a dose of Citi’s tonic

Bank of America boss Brian Moynihan had a tough first year in charge. The Charlotte-based bank was the lightning rod for all mortgage-related storms, took $12 billion of goodwill writedowns against businesses bought by Ken Lewis, the former chief executive, and is the probable target of a forthcoming WikiLeaks campaign to boot. After all that, Moynihan must be hoping that he is finally in line for a dose of rival Citigroup’s tonic.

Citi, BofA’s fellow double-dipper into the U.S. bailout fund, boasts the best-performing stock performance of the big American banks since the start of last year — it’s up almost 50 percent. BofA is the laggard, down more than 3 percent. Of course, Citi fell harder during the crisis. But its turnaround looked stronger. Citi also trades at a higher price-to-book value ratio, though at just 87 percent of book it still has a way to go.

Based on its fourth-quarter earnings report on Friday, things are looking up for BofA, which trades at about 72 percent of book value. Granted, the improvements are hard to spot in the headline loss of $1.2 billion for the period. But the bank reported such a smorgasbord of one-off charges and extraordinary gains — from tax breaks to asset sales to mortgage costs — that a certain amount of progress, albeit slow, was obscured.

For more on this read at: http://blogs.reuters.com/columns/2011/01/21/bank-of-america-must-be-h...

Economy Probably Sped Up as U.S. Consumer Spending Rose Most in Four Years

The economy in the U.S. probably grew at a faster pace in the fourth quarter, driven by the biggest gain in consumer spending in four years, economists projected a report this week will show.

Gross domestic product rose at a 3.5 percent annual pace, up from a 2.6 percent rate in the previous three months, according to the median estimate of 67 economists surveyed by Bloomberg News before a Jan. 28 Commerce Department report. Other data may show business investment remained a pillar of the economic rebound, while home prices decreased.

Ford Motor Co. and Apple Inc. are among companies benefiting from the pickup in household spending that is forecast to extend into 2011 as tax cuts put more money in Americans’ pockets. Federal Reserve policy makers, when they meet this week, may say the improvement in growth isn’t enough to derail a plan to pump more money into financial markets.

For more on this read at: http://www.bloomberg.com/news/2011-01-23/economy-probably-sped-up-as-...

January 22, 2011

European Rescue Fund May Buy Bonds, Recapitalize Banks, ECB's Stark Says

European Central Bank Executive Board member Juergen Stark said measures to strengthen the region’s rescue fund could include purchases of government bonds or injecting cash into commercial banks.

“I could imagine the” European Financial Stability Facility “recapitalizing banks or buying sovereign debt,” Stark said in an interview with Dutch newspaper Het Financieele Dagblad published today, according to an e-mailed transcript from the Frankfurt-based central bank. “But this issue has to be decided at the political level.”

European leaders are seeking ways to overhaul their crisis- response measures after Ireland and Greece last year were both forced to seek external aid. While the ECB purchased government bonds and provided banks with unlimited cash to fight the region’s fiscal crisis, President Jean-Claude Trichet has called on governments to step up efforts to restore confidence.

For more on this read at: http://www.bloomberg.com/news/2011-01-22/ecb-s-stark-says-rescue-fund...

European Stocks Post First Weekly Decline of 2011 on Earnings, China Rates

European stocks posted their first weekly decline this year amid speculation the Chinese government will lift interest rates and as Goldman Sachs Group Inc. posted earnings that failed to exceed analysts’ estimates.

Volkswagen AG and Porsche SE led declines in carmakers, both falling more than 9 percent. EasyJet Plc sank 15 percent after saying its first-half loss may double. ProSiebenSat.1 Media AG fell after Citigroup Inc. cut its recommendation on the stock. Utilities, a so-called defensive sector, posted the best performance among 19 industry groups in the benchmark Stoxx Europe 600 Index.

The Stoxx 600 dropped 0.9 percent this week, after rising for two straight weeks. Even so, the gauge is still up 2 percent this year as reports suggested the global economy continues to recover and investors speculated that European leaders will increase their efforts to contain the region’s debt crisis.

For more on this read at: http://www.bloomberg.com/news/2011-01-14/european-stocks-increase-for...

What’s the relationship between inflation, bonds and stocks?

What is the relation between inflation and equity returns? In the US markets, academics and market experts have often remarked on the strong correlation between nominal bond yields and the earnings yield on stocks. Earnings yields move inversely with stock prices, so that means a negative relation between stock returns and inflation. Bond yields rise with inflation expectations, but why will earnings yield rise? These are the questions that Bekaert and Engstrom try to answer in their paper.

The authors find that while 55% of the variance in the bond yield is driven by expected inflation, 80% of the variation in the earnings yield is driven by the equity risk premium. Why then should there be a correlation between the two yields? That will only happen if expected inflation, the main driver of bond yields, is correlated with the equity premium, the main driver of the earnings yield.

For more on this read at: http://www.livemint.com/2011/01/21215557/What8217s-the-relationship.h...

FM talks of inflation, fiscal responsibility at FSDC meet

Finance minister Pranab Mukherjee said taming inflation was the key priority of the government and no effort will be spared to tackle price rise. Chairing the second meeting of the Financial Stability and Development Council, Mr Mukherjee discussed the state of the economy with financial sector regulators.He also emphasised the need for the government to revert to fiscal consolidation, said an official privy to the discussions. The minister’s comment assumes added significance as it comes ahead of RBI’s quarterly monetary policy review on January 25 in which the central bank is expected to raise key policy rates by 25-50 basis points to tame inflation. Headline inflation based on the wholesale price index shot up to an annual 8.43% in December, from 7.48% in the previous month. “The RBI policy is scheduled on January 25. As a standard practice I have come to review the macroeconomic situation with the finance minister,” RBI governor D Subbarao told reporters after the meeting. The minister also sought inputs of the regulators for the budget to improve and strengthen the financial sector and put the economy on double-digit growth trajectory. The meeting was also attended by Securities and Exchange Board of India chairman CB Bhave, Insurance Regulatory and Development Authority chairman J Hari Narayan, Pension Fund Regulatory and Development Authority chairman Yogesh Agarwal as well as senior finance ministry officials.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Market keeps its fingers crossed ahead of rate call

THE benchmark index of the Bombay Stock Exchange (BSE) Sensex ended the week higher after two weeks of decline, but shed 0.2% on Friday, weighed down by software majors after investors fretted over the exit of two senior personnel at Wipro.

All eyes were now set on the central bank’s quarterly review on Tuesday, in which it is expected to hike key interest rates by 25 basis points as it battles sticky inflation. Earlier in the day, India’s No. 3 software player replaced the chiefs of its key outsourcing business after reporting third-quarter profit growth that lagged its main rivals, sending its shares down the most in a year.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

SBI beats Street estimate; net profit up 14% at Rs2,828 cr

Mumbai: The country’s largest lender, State Bank of India (SBI), on Saturday said its net profit for the quarter ended 31 December rose by 14.08% to Rs2,828 crore, up from Rs2,479 crore in the year-ago period, despite a rise in its loan loss provisions.

A Reuters poll of 16 brokerages had forecast profit to grow 10% to Rs2,715 crore. During the quarter, the lender witnessed a healthy increase in its income from treasury, retail and wholesale banking but showed a slight rise in its gross non performing assets or NPAs, which rose to 3.17% from 3.11% in the year-ago period.

For more on this read at: http://www.livemint.com/2011/01/22131247/SBI-beats-Street-estimate-ne...

Banks aren’t in bad shape after all

THE first set of results of banks for the quarter to December shows a healthy growth in net profit due to an improvement in net interest margin for local lenders, but there is an underlying fear that margins will come under pressure in the next few quarters if the cost of funds go up in the third quarter. For most banks, except in the case of Dhanlaxmi Bank, there has been a slowdown in the growth of deposits. With just three months left for the end of this fiscal, banks will be under pressure to fulfill their deposit mobilisation targets set in the range of 20-22%. For state-run Bank of India (BoI), profits rose largely due to lower provisioning for bad loans and substantial upgradation of accounts from the bad loan category to the performing loan category. Profits also rose because the bank’s net interest margin — the difference between the average cost of funds and the yield on advances, or loans, improved to 3.09% from 2.60% in the third quarter from a year ago. The bank upgraded accounts amounting to . 611 crore from . 56 crore a year ago.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

RBI promises parity if foreign banks form arms

THE Reserve Bank of India (RBI) is dangling the carrot of near level-playing field to foreign banks such as Citigroup and HSBC, if they convert into wholly-owned subsidiaries which is essential for systemic safety, instead of functioning as parents’ branches, leaving room for instability. MNC banks would be allowed to set up branches at their will in smaller cities, barring some security-sensitive regions, and list their shares on stock exchanges with at least 25% Indian holding, said a central bank discussion paper on Presence of Foreign Banks in India. Global banks would have a minimum capital adequacy ratio of 10% and lower priority sector lending target than domestic private peers.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

January 21, 2011

China Can Just Say `No' to One U.S. Export

At a joint press conference to welcome Chinese President Hu Jintao to the U.S. on Jan. 19, President Barack Obama downplayed contentious issues, such as China’s undervalued currency, and focused instead on areas of economic cooperation.

“We want to sell you all kinds of stuff,” Obama said. “We want to sell you planes, we want to sell you cars, we want to sell you software.”

One thing not on his export list: inflation.

It’s become commonplace to accuse the U.S. of exporting inflation to the rest of the world. After all, the dollar is the world’s reserve currency. International trade is conducted in dollars. Print too many of them, and inflation is sure to follow.

Not so fast. The U.S. needs a partner in crime, a willing counterparty to import what the U.S. is selling.

It has a perfect ally in the People’s Bank of China, which prints yuan to absorb the dollars that flow into the country in exchange for its exports.

At an earlier point in time, Federal Reserve Chairman Ben Bernanke was eager to remind us that the central bank has a “technology called a printing press that allows it to produce as many U.S. dollars as it wishes at essentially no cost.”

He didn’t explain that the printing press has only one setting: U.S. dollars. The Fed can’t churn out British pounds, Swiss francs or Chinese yuan. How is it, then, the Fed can export inflation to all these other countries?

For more on this read at: http://www.bloomberg.com/news/2011-01-21/china-can-just-say-no-to-one...

why china won’t buy what the us can’t anytime soon

Chinese President Hu Jintao is in Washington this week, and economic affairs are sure to feature prominently. Inevitably, that will mean talk of “rebalancing”, the notion that Americans need to consume less and Chinese need to consume more. This is typically presented as a question of aggregate American and Chinese levels of investment, household savings and consumption, plus the exchange rate. But the problem with Chinese consumption runs much deeper, a fact that should inform the discussion on both sides.

To see how and why this is, look at banks, which affect so much of the rest of the economy.

China lacks the infrastructure of modern consumer finance, and is years— possibly decades—away from building it to the standards of the developed world. Outstanding consumer credit stands at about 13% of the gross domestic product (GDP), according to a 2009 study from McKinsey and Co., compared with 48% in Malaysia and 70% in South Korea.

Banks face significant structural and regulatory barriers to offering more consumer finance products. One is the lack of national consumer credit ratings that would give banks greater confidence in their ability to measure credit risks. Another is that loan officers and managers still work from a mindset focused heavily on business lending.

Meanwhile, Beijing has lost a decade or more during which it could have allowed foreign banks to start developing a consumer finance market. Thus Chinese banks have faced few competitive pressures to serve lower-income consumer borrowers themselves, so they haven’t. Only in November did regulators allow a foreign company into this brand-new field. Dutch PPF Group will offer in-store financing for durable-goods purchases— the kind of instalment plan that made its appearance in the US 160 years ago.

More interesting is the supply side of the consumption equation. Rebalancing is not a matter of Chinese export factories losing a foreign customer and gaining a domestic one, Patrick Chovanec of Tsinghua University observes. Export factories are part of global supply chains in which someone else does the product development, logistics, marketing and retailing. Chinese export factories aren’t equipped to do those things on their own. Rebalancing would cause them to lose foreign customers and go out of business, allowing entrepreneurs who are oriented towards domestic consumption to buy the assets.

China needs to reallocate capital and labour on a massive scale to orient itself towards producing goods and services that Chinese consumers want to consume. This will require major banking changes, especially improving access to credit for the small- and medium-sized enterprises that make a modern consumption-driven economy tick. Both regulation and habit will get in the way.

The regulation involves interest rates: government manages both deposit and lending rates in a way that guarantees banks a wide spread. This was intended to help banks earn themselves out of an earlier generation of non-performing loans at the expense of households, which earn lower rates on savings deposits. And the policy could prove especially necessary if 2009s credit binge results in huge piles of bad debts. For more on this read at: http://www.livemint.com/2011/01/20194718/why-china-won8217t-buy-what....

Montek sees inflation at 6.5% by March-end

Deputy chairman of the Planning Commission Montek Singh Ahluwalia says in an interview he expects inflation to fall to 6.5-7% by the end of March. Edited excerpts:

At the moment you have high inflation. As far as food is concerned it’s 15.5%. General inflation is 8.4% and yet, at the same time, you have growth that sums to just 2.7% in November. Do you fear the prospect of stagflation?

That’s a very odd way of describing the situation. Actually, the correct description is that inflation was a big problem about a year ago. It has been steadily coming down. It shot up again in December unexpectedly; we didn’t expect that to happen. I think it’s due to seasonal factors affecting some prices. Right now, inflation is more uncomfortable than it was in November, but prices are already beginning to come down for some of these commodities. We think that by the end of the year, end of the fiscal year, inflation could be back in the 6.5%, may be a little higher level. So, I think inflation has ratcheted up unexpectedly, (but) has been steadily coming down, I think it’s getting under control.

As far as growth is concerned, the index of industrial production has shown a sort of very low growth in the last month. That may actually continue for another month because it all depends on base level effect. But as far as growth in the economy is concerned, I think we are on track for something like 8.5%, maybe a little more. We have been saying 8.5% officially and we have been saying it could be a little above that. The above that isn’t very important in my view, 8.5% is quite important.

From the finance minister downwards, officials have been making this prediction (of 6.5% inflation) for the last six months. You made it several times to me in an interview. Do you really believe that it will be 6.5% or is that brave talk, perhaps even just bravado?

No, certainly not bravado. I had expected that we would be down to 6.5% actually in December... I think a couple of things have happened. One is, as I said, there has been a spike in certain vegetable prices, particularly onion, which is due to very unseasonal rain. Nobody could have predicted that, so it is a new development.

The second thing, I think, is (that) internationally commodities’ prices are heating up. Oil prices are high. I do not see any early return to low levels of oil prices and all. So, it is true that compared to what we thought would be the economic situation, maybe five months ago, it is more worrying on the inflation front.

Will it come down (to) 6.5% by end-March? I think if there isn’t any new impetus on the external front, the seasonal factors will have worn themselves out... somewhere between 6.5% and 7% in March is a very good prospect for inflation as a whole. I hope it is 6.5%, but every forecast has an era. Anyone who says it is going to be X, really whatever their technical sort of models are, they involve an era and you have to allow that also.

But when you were explaining why onion prices have suddenly spiked, you blamed it on erratic rain. Many of your colleagues talk about hoarding.

Well, onions are not as perishable as vegetables. It is very difficult to hoard vegetables. I mean, you can’t hoard them for very long. You can never rule out market manipulation in a commodity that runs in a short supply and where an artificial scarcity can be created. So, I would rule it out. But I don’t think that hoarding is the underlying factor that is behind the pressure on inflation over a long period. It could be in the case of onions, that there was market manipulation.

And that, I think, reflects the fact that we don’t have (as) much modern storage as we should, that our market logistics are not (as) good as they should (be), that shortage in one area is not easily compensated by bringing in commodities from other parts. Within the country, prices vary a lot. I mean they are quite high in some parts, low in other parts. And that shouldn’t happen if you have good modern marketing.

At the moment, when onion prices are bringing tears to everyone’s eyes, would I be right in saying that in the short-term, your options are imports, reducing duties and perhaps taking certain items of futures market? For more on this read at: http://www.livemint.com/2011/01/20231342/Montek-sees-inflation-at-65....

Food inflation slows for second week

India’s food inflation slowed for a second week after Prime Minister Manmohan Singh’s government raided traders to prevent hoarding of farm goods and banned onion exports.

An index measuring wholesale prices of agricultural products rose 15.52% in the week ended 8 January from a year earlier, the commerce ministry said in a statement in New Delhi on Thursday. The gauge gained 16.915 the previous week.

Food inflation has remained above 12% for five straight weeks in India, prompting the main opposition Bharatiya Janata Party (BJP) to plan month-long nationwide protests from Thursday. Singh changed his food minister in a cabinet reshuffle on Wednesday in a bid to overhaul his government’s image, while his top economic adviser said the central bank needs to take some action to help cool prices.

Food prices are still at elevated levels, Anubhuti Sahay, an economist at Standard Chartered Plc in Mumbai, said before the report. “The Reserve Bank of India (RBI) will raise rates next week.’

The benchmark nine-year government bond yield fell two basis points (bps) to 8.16% at 11.56am. in Mumbai. The yield has gained 25 bps this month on speculation RBI governor D. Subbarao may boost rates for the seventh time in a year, the most in Asia, at a 25 January policy meeting. The central bank’s benchmark repurchase rate is 6.25%.

A basis point is one-hundredth of a percentage point.

High food costs for a sustained period will lead to more wage demands, stoking inflation, C. Rangarajan, chairman of the Prime Minister’s Economic Advisory Council, said on 7 January. Lentil prices fell about 15% in the week ended 8 January from a year earlier, Thursday’s report showed. Wheat declined 6.1% while onion prices nearly doubled, according to the report.

On 21 December, India halted exports of onions until further notice. The government raided agriculture traders this month to curb hoarding.

Singh put K.V. Thomas in charge of the ministry for food and consumer affairs, a portfolio previously held by agriculture minister Sharad Pawar. Bloomberg For more on this read at: http://www.livemint.com/2011/01/20233529/Food-inflation-slows-for-sec...

China economy grows 10.3 pct in 2010

The National Statistics Bureau said inflation eased to 4.6 percent in December from a 28-month high of 5.1 percent the month before, as food prices moderated slightly. That put inflation for the full year at 3.3 percent.

But the apparent easing in price pressures also reflects a relatively low base the year before, analysts say, urging authorities to do more to rein in the lavish bank lending that is supporting excess investment.

Investment in construction and other fixed assets shot up 23.8 percent over a year earlier in 2010. That was a big drop from the 30.1 percent increase fueled by stimulus spending to counter the global crisis in 2009. But the economy remains too dependent on such investments, which many experts fear is inflating a potentially dangerous financial bubble.

By most of the usual measures, the world's second largest economy is doing just fine, but the huge sums of money being pumped into the economy by state-run banks are hindering moves to bring politically risky inflation under control.

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

Over A Barrel

As crude oil hovers around the $100-mark and is expected to go up further, policy-makers, consumers, oil marketing firms & their investors are all busy figuring out the implications for them. Can we take lessons from the 2008 experience when oil hit the $146 mark? Himangshu Watts

CUSTOMERS, GET READY FOR HIGHER PRICES of fuel and commodities. Blue-chip oil companies, prepare for losses or a sharp fall in profit. And shareholders in state energy firms, swallow the fact that in analyzing these shares, fundamentals will be outweighed by an imponderable government policy.

Crude oil hovers close to $100, but the government has frozen diesel prices since June last year fearing political backlash and high inflation. Since then the crude prices have risen by a fifth, putting at risk large equity offering planned by state oil firms and raising fears of another spurt in inflation.

Many analysts say oil prices could rise further. The Opec, which represents the leading oil producers, says the global oil market is well supplied, and blames speculation for high prices. But the International Energy Agency, which was set up by the developed countries in response to skyrocketing oil prices in the early 1970s, says current oil prices are at an “alarming” level and can dent economic recovery.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

OIL ON BOIL

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

No change likely in FSDC role

No Statutory Backing, Govt May Go For Gazette Notification For FSDC Deepshikha Sikarwar NEW DELHI

THE government is unlikely to make changes in the mandate of the recently set up Financial Stability and Development Council, despite lingering concern among regulators that the interregulatory mechanism will encroach on their autonomy.The FSDC will meet for the second time on Friday to take stock of the economy. “How can the mandate be changed? The mandate is evident in the name of this body itself,” said a person involved in the discussions, adding that concerns of the regulators have already been addressed. An ET story on January 19 said market watchdog Sebi and banking regulator RBI had again voiced concerns over the mandate of the body at its first meeting late December. The regulators had said that the body should not be made responsible for the ‘development’ of the financial sector. Financial inclusion is high on the UPA government’s agenda and the idea behind keeping ‘development’ as part of the body’s mandate was to give it a push, the person said.

The financial sector regulators were consulted on the issue and the government had reworked the architecture of the council after they expressed concerns before the body was notified. The government had made the RBI governor the head of a sub-committee of the Council that has the mandate to look after financial stability and inter-regulatory coordination. In the original plan, the sub-committee was to be headed by the finance secretary. For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Microfinance: misunderstood, Malegamed

A generally beleaguered microfinance industry was eagerly waiting for Yezdi Malegam for deliverance. Any conversation about the microfinance business would end with the expectation that the Malegam committee would deliver a healthy dose of oxygen to the choking microfinance industry. The report was expected to be the panacea for all that ails microfinance in India.

The report, which came out on Monday, disappoints not only in its inability to meet these expectations, but also on fundamentals. While each one of the recommendations may have merit when seen in isolation, together they are a lethal combination. It is difficult to accept that the collective wisdom of Malegam, Shashi Rajagopalan, an expert in cooperatives; Aditya Birla Group head Kumar Mangalam Birla; Reserve Bank of India (RBI) deputy governor K.C. Chakrabarty and former chief of India’s space research organization U.R. Rao could have delivered this blow to the microfinance sector in the country.

First, the good things in the recommendations: The committee suggests retaining priority sector status for the microcredit business; keeping microfinance institutions (MFIs) out of the Moneylenders Act; keeping the regulatory role with RBI instead of state governments; enhancing the role of RBI in supervision; and engaging with industry associations on an ongoing basis.

However, there are several problems with the report. Chakrabarty, during his brief tenure as the central banker in charge of rural credit, provided progressive measures for financial inclusion in the banking sector by suggesting two radical steps in the rather conservative atmosphere of RBI—the first was to remove licensing requirements for opening branches in towns with a population less than 50,000 people; the second was to remove the interest rate cap on all loans as the base rate regime kicked in. The only area where there were some controls on interest rates was in the case of politically sensitive agricultural loans. As a member of the Malegam committee, he has signed off on a report that puts a cap on microfinance interest rates at 24%, without dissent. The question is not whether 24% is an appropriate cap; it is more about the principle. For more on this read at: http://www.livemint.com/2011/01/20182947/Microfinance-misunderstood-M...

Banks tighten lending for commercial realty

Mumbai / Bangalore: Banks are getting tough with developers of commercial projects such as office buildings, malls and shopping centres—a fallout of the corporate loan scam that came to light last year. Meanwhile, several large property developers have to repay loans in the coming months.

Builders seeking fresh loans have been asked to meet more stringent conditions, including demands to produce five-year lease agreements with tenants, and having to settle for considerably lower borrowings against future rent receivables, two bankers said.

Indian Overseas Bank, for instance, will lend to developers only if they produce a five-year leasing agreement with a lock-in period for tenants.

“This is what banks do at this moment,” said M. Narendra, chairman and managing director of the public sector bank. “This way, you can be sure of the repayment capacity of the borrower.”

Banks grew wary of lending to commercial real estate projects after several of them turned sour during the slowdown and developers struggled to repay debt. Their worries increased when in November the Central Bureau of Investigation nabbed eight senior officials of state-owned banks and other financial institutions for irregularities in lending to builders.

For more on this read at: http://www.livemint.com/2011/01/20231544/Banks-tighten-lending-for-co...

Wipro underperforms again, joint CEOs resign

New Delhi: Wipro Ltd has once again performed at or around already low market expectations for the third quarter and joint CEOs Girish Paranjpe and Suresh Vaswani have resigned, making way for T.K. Kurien as the CEO of the IT business and executive director of the company.

Wipro Ltd consolidated numbers, which also include its other businesses like consumer care, show an increase in net profit to Rs1,319 crore, up 3.36%, and a revenue increase to Rs7,829 crore, an increase of 1.26 % sequentially. Operating margins remained flat at 22.2 %. Consensus numbers for revenue were around the Rs8,000 crore mark. Dollar denominated global IT revenues rose 5.6% to $1.34 billion (QoQ).

“The operating margins for IT services business was flat, despite lower working days and drop in utilization,” Suresh Senapaty, executive director & chief financial officer said.

For the fourth quarter of FY11, Wipro expects IT services revenues to go up by 3-5% to $1.38-1.41 billion (QoQ).

IT products constituted 11% of total revenue and IT services constituted 76% of total revenue in the third quarter.

Azim Premji chairman of Wipro said, “The joint CEO structure was one of the key factors that successfully helped us navigate the worst economic crisis of our times. With the change in environment, there is a need for a simpler organization structure. Over the last 10-year, Kurien has been instrumental in building and scaling our businesses. Kurien’s track record makes him uniquely positioned to lead Wipro through the next phase of growth.”

Vaswani and Paranjpe have been with Wipro for 20-year. “They have made significant contributions in the critical years of expansion and played a stellar role in the success of the IT business.”

In a phone interview Girish Paranjpe, one of the joint CEOs of Wipro, who put in his papers on Friday along with Suresh Vaswani said that the model of joint CEO was adopted to deal with the global financial crisis. Now with things stabalising, there was need for a simpler organization structure.

He denied that internal rivalries or elevation of Premji’s son in the company was the reason behind it. He also the two had decided to leave several months ago and the board finally took a decision last week. It was a consensual decision. He ducked the question whether Premji suggested any way in which both of them could have stayed in different roles.

While Kurien will take over from 1 February, Vaswani and Paranjpe will work together till 31 March, 2011 to ensure a smooth transition. For more on this read at: http://www.livemint.com/2011/01/21074446/Wipro-underperforms-again-jo...

January 20,2011

China's Quickening Economic Growth Fans Speculation Interest Rates to Rise

China’s economic growth accelerated to 9.8 percent as industrial production and retail sales picked up, sending stocks lower from Asia to Europe on concern Chinese policy makers will raise interest rates and stem the expansion.

The fourth-quarter expansion exceeded the 9.4 percent median estimate in a Bloomberg News survey of 22 economists and the 9.6 percent annual gain in the previous three months, a statistics bureau report showed. Consumer-price inflation eased to 4.6 percent in December. Citigroup Inc. and Credit Suisse Group AG say inflation may peak at as much as 6 percent in the first half.

“If the economy keeps growing at the current pace, inflation will remain alarming,” said Liu Li-Gang, a Hong Kong- based economist at Australia and New Zealand Banking Group Ltd. Beside raising lenders’ reserve requirements, the central bank should boost benchmark rates, he said.

China may also allow more gains in the yuan to contain consumer prices and ease trade tensions, a topic on the agenda of President Hu Jintao’s meetings in the U.S. this week. In Tokyo, Japanese government minister Kaoru Yosano said his country was probably overtaken as the second-largest economy last year, after today’s report showed China’s gross domestic product totaled 39.8 trillion yuan ($6.04 trillion).

The Shanghai Composite Index tumbled 2.9 percent to close at a four-month low. The MSCI Asia Pacific index lost 1.3 percent. On the Frankfurt Stock Exchange, the preferred shares of Volkswagen AG, the largest European carmaker in China, slid 5 percent as of 11 a.m. local time.

Yuan Trading

Non-deliverable yuan forwards traded at 6.4780, indicating that the currency may appreciate about 1.7 percent against the dollar in the next 12 months.

China’s economy expanded 10.3 percent in 2010, the fastest pace in three years, the statistics bureau report showed. That compared with growth of 9.2 percent in 2009. The nation’s standing as the No. 2 economy may be confirmed on Feb. 14 when Japan reports gross domestic product for the fourth quarter.

Bank of America-Merrill Lynch estimated today that, using average full-year exchange rates, China’s GDP was about $380 billion bigger in 2010 than Japan’s. For more on this read at: http://www.bloomberg.com/news/2011-01-20/china-s-economic-growth-acce...

Who says it doesn’t pay to default?

If the EU chooses sovereign default to solve the problem of solvency in its distressed economies, it will call the investors’ bluff and ultimately prove to be a less costly option, says T T Ram Mohan

THE European Union is today the sick man of the world economy. The global economic outlook is more promising than thought a year ago. The world economy will grow at 4.5-5% in 2011. Emerging markets will grow at around 7%. The US is poised to grow at 3-3.5%. The EU will be stuck at 2% or less.

EU growth matters less to the rest of the world than its capacity to destabilise the world’s financial system. Last year, the EU orchestrated a rescue of Greece and Ireland. What if Portugal, Spain, Italy and Belgium were to require rescue this year? Would the stronger economies of the EU, Germany and France, have the stomach to effect a bigger rescue if required? And if they didn’t? These are questions that trouble the world’s financial markets today. The rest of the world needs to worry less about exports to the EU than a disruption of financial flows as happened during the sub-prime crisis.

The EU is contemplating moves to reassure the markets. Support to the European Financial Stability Fund (EFSF), the bailout fund created to prevent the break-up of the euro, is to be improved. The EFSF was advertised as a €440 billion fund but not all of this is available for lending.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

A throwback to the 1960s

Complaints about the inflationary effects of American monetary policy are rampant, despite there being barely a hint of inflation in the US. Rapidly growing catch-up economies are paddling furiously to avoid being dragged down by a torrent of capital inflows. Prominent policymakers, desperate for alternatives to America’s malfunctioning monetary system, have gone so far as to allude to a return to the gold standard.

I am not talking about 2011, but about 1964. We have been here before.

In 1964, it was the rapidly growing economies of Europe, still catching up to the US, that were howling about the Federal Reserve. As a result of a recklessly expansionary American policy, they argued, they were being flooded with imported finance. The US was “exporting inflation”.

American officials countered that the financial inflows reflected Europe’s underdeveloped capital markets. Europe’s inflation problem was a byproduct of its central banks’ reluctance to tighten policy more aggressively, and European countries’ hesitancy to let their currencies rise, reflecting their long-standing commitment to export-led growth.

Plus ça change, as the French would say.

What the French under Gen. Charles de Gaulle actually did say was that fiat monies should be jettisoned in favour of the gold standard. The US would then be subject to tighter policy discipline. But the French never explained exactly how restoration of the gold standard might be accomplished, or how it would translate into price and economic stability, given gold markets’ volatility and the disastrous consequences of the gold standard—not least in France—in the 1930s.

The debate, in other words, was as confused and confusing as it is today. Its one positive effect was to launch an effort to reform the international monetary system. So now that the French government— not them again! —has committed to making international monetary reform the centerpiece of its G-20 presidency in 2011, it is worth recalling the cautionary tale of the 1960s.

Back then, international monetary diplomacy focused on creating a new form of international reserves, what became the International Monetary Fund’s, or IMF’s, Special Drawing Rights (SDRs). The idea was that by issuing SDRs, IMF would provide catch-up economies seeking to accumulate reserves with an alternative to piling up dollars. The US could no longer run balance-of-payments deficits “without tears”. American policy could be reined in without starving the global economy of liquidity.

The effort failed completely. Special Drawing Rights never became an attractive alternative to the dollar, only modestly supplementing dollars and other national units in international use. Because they did not trust IMF to assume the powers of a global central bank, the Fund’s members established high hurdles to creating SDRs. Private markets in SDR-denominated instruments similarly failed to develop, in turn limiting their appeal to central banks. For more on this read at: http://www.livemint.com/2011/01/19200443/A-throwback-to-the-1960s.htm...

India may attract $250 bn FDI in next five-year: Sharma

New Delhi: The government today said it aims to attract, in the next five-year, a whopping $250 billion foreign direct investment (FDI) into India, which has become an investor-friendly destination for global investors.

“In the next five-year, we are aiming to have $250 billion FDI coming into India,” commerce and industry minister Anand Sharma said at a CII function here.

The target of $250 billion looks ambitious in the wake of India receiving cumulative FDI of $124 billion into equity in the last 10-year. This fiscal FDI inflows stood at $14 billion during April-November 2010-11, a decline of 27% over the same period last year.

The government is taking steps to attract more and more foreign direct investment (FDI). It is considering to allow FDI in sectors like multi-brand retail and defence.

Sharma said that during the global economic crisis, India remained one of most attractive destination for foreign investors.

“We have an investor-friendly policy regime,” he said.

Speaking on the occasion, South Korean trade minister Kim Jong-Hoon said that huge business opportunities are available for Indian and Korean companies in each others region.

The visiting minister is here for the first review of the India-South Korea Comprehensive Economic Partnership Agreement (CEPA), implemented a year ago.

After the implementation of the free trade pact, the two-way trade between the countries grew by about 45% during January-November 2010 to $15.6 billion.

Both Sharma and Hoon said that the bilateral trade target of $30 billion by 2014 is achievable.

Hoon said that to further enhance investments in India, there is a need of some more Korean bank branches here to facilitate Korean businesses in India.

“We do need some more banking services (which are) very familiar with Korean business and that’s why I would like to ask your government to give a good consideration to give some more permissions to Korean banks to open their offices here,” Hoon said.

Sharma said that he has received two applications from South Korea, who is interested in opening bank branches in Chennai.

“I have talked to our officials and we will find a way how to facilitate the approvals required (for) the two Korean banks which have asked for approvals to set base in Chennai... at the earliest,” Sharma said.

Hoon said that over 200 Korean companies, including Hyundai, LG and Samsung, are already present in India and many other firms like Dusan Heavy Industries and Hyundai Constructions have shown interest in the Indian infrastructure sector. For more on this read at: http://www.livemint.com/2011/01/20153137/India-may-attract-250-bn-FDI...

Food inflation eases, but RBI action seen

New Delhi: India’s food inflation eased for the second straight week in January, tracking lower fruit and vegetable prices, but accelerating headline inflation in December is likely to put pressure on the Reserve Bank of India (RBI) to raise rates at policy review next week.

India’s food inflation quickened to a one-year high late last month as unseasonal rains spoilt summer harvest of perishable vegetables like onions, potatoes and tomatoes in several key producing states.

India’s food price index rose 15.52% and the fuel price index climbed 11.53% in the year to 8 January, government data on Thursday showed.

In the prior week, annual food and fuel inflation stood at 16.91% and 11.53%. The primary articles price index was up 17.03% in the latest week, compared with an annual rise of 17.58% a week earlier.

Analysts expect food prices to moderate by February, but they would still remain high.

“The build-up of food inflation will take two months to dissipate. So, it will moderate in January and February and we expect food inflation at 10-12% by March,” said Abheek Barua, chief economist at HDFC Bank.

“I expect the RBI to continue to be hawkish and continue with its rate hikes as non-food primary product inflation is sticky and can have pass through effect into wages and general prices,” Barua said.

The wholesale price index, the most widely watched gauge of prices in India, rose 8.43% in December from a year earlier, compared with 7.48% in November, reflecting that food inflation has fed into the broader economy.

While monetary measures are largely ineffective in tackling supply-led problems like food inflation, the RBI is widely expected to raise policy rates by 25 basis points in its 25 January policy review to rein in inflationary expectations and dampen overall demand.

India’s 5-year swap rate was down 2 basis points to 8% on a knee-jerk reaction after weekly food inflation eased, but rose back to previous levels as rate hike concerns and a hawkish policy stance weighed.

This week, the RBI governor Duvvuri Subbarao said that the central bank is ‘desperate’ to control inflation, in a sign which is being widely read as indicative of further monetary tightening.

Finance minister Pranab Mukherjee met state finance ministers on Wednesday and said local factors are widening the gap between wholesale and retail prices.

Mukherjee said the government has taken measures to facilitate imports and restrict exports where needed, but urged state governments to review local levies and state level marketing regulations which add to food prices. For more on this read at: http://www.livemint.com/2011/01/20111432/Food-inflation-eases-but-RBI...

Panel moots 24% cap on microfinance loans

A Reserve Bank of India (RBI)-appointed panel to suggest regulations for the country’s microfinance institutions (MFIs) has proposed a 24% cap on the interest rate that they can charge, a limit on the amount a person can borrow, besides recommending a separate category of non-banking financial companies (NBFCs) in the sector.

The much-anticipated recommendations have been unveiled as the Rs.20,000 crore industry has come under intense pressure because of recent stringent law in Andhra Pradesh, which accounts for a quarter of microcredit loans, that have brought repayments to a halt.

The Andhra Pradesh law was prompted by accusations of profiteering and strong-arm tactics being used by MFIs to extract repayments.

The RBI panel, headed by chartered accountant Y.H. Malegam, including deputy governor K.C. Chakrabarty, has also made it clear that the new category of NBFC-MFIs will not come under the Andhra Pradesh law and will be solely regulated by the central bank.

The committee said its recommendation, if accepted, must be implemented by 1 April, as “the borrowers are currently suffering some hardships for which relief must be provided at an early date”. In any case, the recommendations on the lending rate cap should be made effective on all loans given by MFIs after 31 March, the panel said.

For more on this read at: http://www.livemint.com/2011/01/20000147/Panel-moots-24-cap-onmicrofi...

Here comes the Chinese MNC

Will China buy up the world? Not yet, but keep an eye on how Chinese firms are moving abroad with speed, not just to purchase natural resources such as oil, coal and timber, but also to make their mark in competitive industries such as technology hardware. New data released this week show foreign direct investment (FDI) in China climbed to a record $105.7 billion in 2010, even as such investment into India fell to $23.7 billion. And the Chinese government said on Tuesday that investment by Chinese firms in non-financial activities outside the country hit $59 billion in 2010, up by more than one-third compared with 2009. If you set aside the around $25 billion of FDI that came into China’s red-hot property sector last year, then you come across the stark fact that the gap between inbound and outbound FDI is narrowing very fast in China. The well-known explanation is that China is frenetically buying natural resources in Africa and elsewhere to fuel its growth engine, often winning deals that India has also been chasing. However, as the World Bank’s private sector development blog noted in a recent post, “Most of Chinese outbound FDI projects have been in the IT and communications sectors, led by emerging multinationals such as Huawei Technologies (whose products and solutions have been deployed in more than 100 countries), ZTE (which operates in more than 140 countries) and Lenovo.” The emergence of Chinese multinationals (MNCs) on the world stage could be one of the most important business trends in the new decade. It will likely be on a par with the emergence of Japanese MNCs such as Sony and Nissan in the 1970s and South Korean MNCs such as Samsung and Hyundai in the 1990s. Companies from emerging markets tend to move out for a variety of reasons—from securing natural resource supplies to getting access to new technology to derisking their business. But most of all, it is a sign that the home economy has developed and the local currency is appreciating. We see these factors at play in China right now. The problem is how other governments should respond, given the well-known habit of Chinese firms to work in close proximity with government, blurring the lines between business ambition and national strategic moves. This is why countries from the US to India continue to treat Chinese FDI with suspicion. For more on this read at: http://www.livemint.com/2011/01/19194604/Here-comes-the-Chinese-MNC.h...

Goldman profit slides as bond trading wilts

Goldman Sachs Group Inc posted a 53 percent decline in fourth-quarter profit as trading revenue tumbled, dashing hopes that the Wall Street bank had bucked a tough trading climate in debt markets.

Bond trading revenue, including commodities and currencies, slid 39 percent from the third quarter as worries about European sovereign debt and rising U.S. Treasury yields kept investors on the sidelines.

"Things were just dead" in December, though "it's sure a lot more active" in January, Chief Financial Officer David Viniar said on a conference call.

For more on this read at: http://www.reuters.com/article/idUSTRE70I2OU20110119?loomia_ow=t0:s0:...

Morgan Stanley fourth-quarter profit jumps

Morgan Stanley posted stronger-than-expected quarterly revenue and retail brokerage profit jumped, validating its strategy of bolstering businesses that are less threatened by tougher regulation following the financial crisis.

While fourth-quarter profit fell short of forecasts, investors focused on the bank's stronger results in areas such as asset management. Morgan Stanley shares rose 4.6 percent.

In 2009, after the financial crisis brought the bank to the brink of failure, Morgan Stanley began reducing its reliance on trading and risk-taking for profit.

For more on this read at: http://www.reuters.com/article/idUSTRE70J2LL20110120

January 19,2011

ECB Officials Edge Back From Threat of Higher Rates

European Central Bank officials retreated from a threat to raise interest rates, saying markets have over-reacted to their change in tone on inflation.“The Governing Council of the ECB sees present interest rates as adequate,” council member Ewald Nowotny said at an event in Budapest yesterday. “We do not see a need for an interest rate change in the foreseeable future.” Bundesbank President Axel Weber also said he expects inflation to remain below the ECB’s 2 percent limit in the medium term, softening his language on the risks to price stability.“It looks like the ECB is now trying to fine-tune market expectations,” said Laurent Bilke, global head of inflation strategy at Nomura International in London, who used to work as a forecaster at the ECB. “The market didn’t get the ECB completely right, but at the same time policy makers will not be successful in telling the market that there hasn’t been a shift in the policy stance.”The euro has risen five cents against the dollar since ECB President Jean-Claude Trichet last week warned that the central bank will act if needed to contain inflation risks, which he said “could move to the upside.” Nowotny joins Athanasios Orphanides of Cyprus in suggesting markets may have over-reacted to the comments.

For more on this read at: http://www.bloomberg.com/news/2011-01-19/ecb-officials-edge-back-from...

Citigroup Earnings Miss Estimates as Stock and Bond Trading Revenue Slumps

Citigroup Inc., the third-largest U.S. bank, posted a profit of $1.31 billion that missed analysts’ estimates as revenue from stock and bond trading fell more than at JPMorgan Chase & Co.Fourth-quarter net income was 4 cents a share, compared with a $7.58 billion loss, or 33 cents, in the same period in 2009, New York-based Citigroup said today in a statement. Eight analysts had predicted in a Bloomberg survey that Citigroup would report a per-share profit of 7 cents.The results blemished Vikram Pandit’s first profitable year as chief executive officer, and the stock sank 6.4 percent, the most in more than six months. Citigroup made less money from buying and selling stocks with its own money and trading government bonds with clients, Chief Financial Officer John Gerspach said on a conference call with reporters.“Trading tends to ebb and flow,” Gerspach, 57, said. “This was one of those weaker quarters, and I’d say one quarter doesn’t make a trend.Equities-trading revenue fell 43 percent from the third quarter to $596 million, while fixed-income trading dropped 58 percent to $1.48 billion. David Trone, an analyst at JMP Securities LLC in New York, had predicted $1.23 billion for equities and $3.22 billion for fixed-income.At New York-based JPMorgan, equity-trading revenue was $1.13 billion in the fourth quarter, almost unchanged from the third quarter, while fixed-income fell 7.9 percent to $2.88 billion.

For more on this read at: http://www.bloomberg.com/news/2011-01-18/citigroup-net-misses-estimat...

The Latest American Export: Inflation

What do the years 1971, 2003 and 2010 have in common? In each year, low U.S. interest rates and the expectation of dollar depreciation led to massive "hot" money outflows from the U.S. and world-wide inflation. And in all three cases, foreign central banks intervened heavily to buy dollars to prevent their currencies from appreciating.

When central banks issue base money to buy dollars, domestic interest rates are forced down and domestic inflationary pressure is generated. Primary commodity prices go up quickly because speculators can easily bid for long positions in organized commodity futures markets when interest rates are low.

The world saw a surge in the dollar prices of primary commodity prices in 1971-73 following the Nixon shock of 1971 when the U.S. abandoned the gold standard. There was also a commodity price surge during the Greenspan-Bernanke shock of 2003-04, when the federal-funds rate was reduced to an unprecedented low of 1% followed by a falling dollar.

For more on this read at: http://online.wsj.com/article/SB1000142405274870440570457606425278242...

Volcker Rule Should Require Sign-Off by Bank CEOs, Panel Says

Regulators should carry out a “robust implementation” of the Volcker rule that includes requiring banks’ chief executives to vouch for their compliance systems, a U.S. government panel said.

The Financial Stability Oversight Council, charged with preventing a repeat of the 2008 financial crisis, released a study yesterday recommending that regulators mandate a “public attestation” on compliance by CEOs. The 81-page study analyzed ways that the Volcker rule, which bans banks from risking capital by trading for their own accounts, should be applied.

The council’s study “may be a workable approach to dealing with a hard requirement,” William Sweet, a former attorney at the Federal Reserve and a partner at Skadden, Arps, Slate, Meagher & Flom LLP in Washington, said in an interview. The sign-off requirement “puts the CEO in a very difficult position.”

The rule, named after former Fed Chairman Paul Volcker, is aimed at reducing the chance that banks will make risky investments with their own capital that put their federally insured deposits at risk. Goldman Sachs Group Inc. and JPMorgan Chase & Co. are among Wall Street firms breaking off or winding down proprietary trading units to comply with the rule, a provision of the Dodd-Frank financial-overhaul law approved by Congress last year.

For more on this read at: http://www.bloomberg.com/news/2011-01-19/volcker-rule-should-require-...

Opportunity, challenge at FDIC

Few regulators understand as well as Jim Wigand the mechanics of closing down a troubled bank quickly and successfully.

During his decades at the Federal Deposit Insurance Corp. and at the Resolution Trust Corp., which was formed by the government in the wake of the savings and loan crisis in the 1980s, he has served as a sort of deal maker on behalf of the government. He sorted through the wreckage of hundreds of banks, directing the sale of failed firms and their assets to try to minimize the economic fallout and safeguard depositors.

This month, the 54-year-old career civil servant is taking on a new role, one that lies at the heart of preventing another crisis like the one that crippled the economy in 2008. As director of the FDIC's new Office of Complex Financial Institutions, Wigand will be responsible for keeping an eye on some of the nation's largest and most complex financial firms and making sure the government is prepared to seize and liquidate them should they falter.

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

Spain finance: Unsteady balance

After a key bond auction and reasonable year-end results for one of the country's largest banks, there is some cause for temporary relief in Spain. The developments will not dispel the persistent concerns over the country's fiscal health and the state of its beleaguered banks, but nor are they likely to stoke additional fears about Spain edging closer to an emergency bailout.

Following a relatively successful bond auction by Portugal last week, attention quickly moved on to Spain. The country sold €3bn worth of bonds in teh auction on January 13th, while Banesto, one of its larger banks, was the first to report year-end results. Taken together, these events suggest that although conditions in Spain are not necessarily improving, they are also not deteriorating enough to cause extra alarm.

The government bond auction settled at an average yield of 4.54% for new five-year debt, up from 3.58% in a similar sale in November but marginally lower from yields in the secondary market ahead of the sale. The new bonds were 2.1 times oversold, a more encouraging result than the 1.6 times achieved in the previous five-year sale. Spain's benchmark ten-year yield, having matched a record-high on January 10th, narrowed on the news; the spread over German bunds is now back to levels last seen in early December (see top chart).

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

IBM blows past forecasts, services contracts rise

International Business Machines Corp.’s quarterly profit blew past Wall Street estimates, and a long-hoped-for recovery in its services business raised optimism that global companies were confident enough to spend more on technology.

IBM shares rose 2.7% after-hours after the company reported that fourth-quarter net income rose 9% to $5.3 billion. Its earnings per share (EPS) of $4.18 easily exceeded its $3.59 of the year-earlier quarter and Wall Street’s average forecast of $4.08, according to Thomson Reuters.

Investors were particularly relieved with the pick-up in signings of services contracts, an early indicator of future revenue from outsourcing and other IT projects. Many clients had been wary of committing to multiyear contracts amid an uncertain global economy.

For more on this read at: http://www.livemint.com/2011/01/19080200/IBM-blows-past-forecasts-ser...

Sensex rises 209 points on record TCS profit

India’s benchmark stock index rose for the second day, led by software exporters, after Tata Consultancy Services Ltd reported record third-quarter profit.

Tata Consultancy climbed 5.7%, its highest close. Earnings of the nation’s largest software services company exceeded analyst estimates after it won orders from Deutsche Bank AG and Hilton Worldwide Inc..

Rival Wipro Ltd advanced the most in a month. The companies get about two-thirds of their sales from the US and Europe.

For more on this read at: http://www.livemint.com/2011/01/18213417/Sensex-rises-209-points-on-r...

World stocks surge to 28-month high

The euro rose more than 1% against the dollar on Tuesday on buying by sovereign funds and a surge in German investor sentiment, while global stocks hit a fresh 28-month high despite a sluggish US open.

More gains for the euro are expected after the ZEW think tank in Germany said about 50% of investors now expect the European Central Bank will have to raise interest rates within the next six months.

ZEW’s monthly index jumped to 15.4 points from a reading of 4.3 in December, its highest level since July, and easily surpassed the consensus forecast of 6.8 points in a Reuters poll of 36 economists.

For more on this read at: http://www.livemint.com/2011/01/18235856/World-stocks-surge-to-28mont...

RBI,Sebi again slam reform role for FSDC

THE Financial Stability and Development Council (FSDC) headed by Finance Minister Pranab Mukherjee taking up ‘financial sector reforms’ as its agenda is probably leading to the worst fears of Duvvuri Subbarao and CB Bhave’s come true — that the government may encroach on regulatory turf. Reserve Bank of India Governor Subbarao and capital markets regulator CB Bhave opposed slipping in the sectoral reforms into the council’s task at a meeting with Mukherjee a fortnight ago. The council was conceived primarily to ensure financial stability and to be a diplomatic channel to settle disputes between the regulators. FSDC would deal with issues relating to “financial stability, financial sector development, inter-regulatory co-ordination, financial literacy and financial inclusion and macro prudential supervision of the economy, including the functioning of conglomerates”, said a recent government notification.

This, the regulators believe is against what the government had promised when the council was formed. Inclusion of it would impinge on the autonomy of the regulators, they said, according to a person with direct knowledge of the issue. The government should leave no room for ambiguity when the council guidelines are finalised, they had said. But Mukherjee in the past had said the government would not interfere. “The intention is quite clear,” Mukherjee had said. “We are not going to interfere with the autonomy of the regulators in their respective areas.” The council first thought about after the credit crisis, had its scope widened after a public spat between the Insurance Regulatory & Development Authority (IRDA) and the Securities & Exchange Board of India (Sebi) over the regulation of unit linked insurance schemes. When the government came with an ordinance to settle the dispute, central bank’s Subbarao opposed it saying it might be used to curb regulators.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

MFIs must go beyond lending

FOXCONN, the world’s biggest manufacturer of electronic components, runs an entire city of 4,50,000 workers in China, Foxconn city. This summer, 14 workers committed suicide. The media blamed this on low wages and bad working conditions. One Chinese professor wrote that Foxconn’s working conditions were actually high by Chinese standards. Another said 14 suicides in a population of 4,50,000 meant a suicide rate of just 3.5 per lakh of population, far lower than China’s overall suicide rate of 14 per lakh. But these cold facts could not counter the terrible publicity of the suicides. Foxconn decided to cut its workforce in the city by one-third, raise wages and relocate in several other interior cities. It plans a total workforce of 1.3 million split into several locations, in none of which it has a dominant population share. That way, even if total suicides do not fall, suicides per location will be few, and cease to attract media or political attention. The main lesson for Indian microfinance institutions (MFIs) is that allegations of suicide cannot be rebutted by technocratic analysis. They can be met only through politically sensitive solutions, including dispersion among several locations.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Looking inside insider trading laws

THE law on insider trading is one which everyone thinks they understand but is amongst the most misunderstood laws in the financial sector. The hubris that they understand this law extends not only to market participants and lawyers but to regulators and judges. The problem is universal and is by no means unique to India or the developing world. While I claim no higher understanding of this law, like the Greek philosopher at least I know that I don’t know. Here are some of the issues I think are important and which need resolution in the Indian context.

The classic insider trading violation is when a senior officer or director who is privy to price sensitive inside information, like a quarterly profit report, trades based on such information before disclosure is made to shareholders of the company. Such trading is outlawed virtually the world over because it is a violation of the fiduciary duty of the insiders to their shareholders, and are thus obliged to keep shareholder interest ahead of their own. Unfortunately, there is a vast minefield outside this simple scenario. The minefield exists both in countries which do not define but outlaw insider trading (US) and which define and outlaw insider trading (India). The haze surrounds such basic issues as the definition of an insider, what is inside information and when does violation occur.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

January 18,2011

EU Seeks to Bolster Crisis Safety Net as AAA Nations Weigh Cost

Germany pushed back at European Union calls for a rapid reinforcement of the safety net for debt-strapped countries, saying the rally in southern European bond markets buys time to craft a new strategy.

German Finance Minister Wolfgang Schaeuble said there is no urgent need to act, eyeing a late-March deadline to strengthen the 750 billion-euro ($1 trillion) rescue fund, hammer out a permanent anti-crisis tool and tighten fiscal rules for the 17- nation euro area.

“We still have a continuing crisis,” EU Economic and Monetary Commissioner Olli Rehn told reporters after the bloc’s finance ministers met in Brussels today. “We’ve had some respite in the last couple of days, but we cannot afford any kind of self-complacency.”

Germany’s run-in with the EU’s central authorities evoked the tensions last year when the bill mounted for a rescue of debt-strapped Greece, ultimately forcing Chancellor Angela Merkel to underwrite a precedent-setting 110 billion-euro aid program.

For more on this read at: http://www.bloomberg.com/news/2011-01-17/eu-seeks-stronger-debt-crisi...

Portuguese Bailout Will Make Euro Crisis Worse: Matthew Lynn

New year, new crisis. No sooner had Europe’s bond traders, politicians and central bankers gotten back to their desks than it was time to begin tussling over the fate of a small economy on the periphery of Europe.

This time around, it’s Portugal. And yet the script seems very similar to the one played out already in Greece and Ireland. Bond yields surge. The government denies furiously there is any need for a bailout. French and German leaders rehash some of their lines about the importance of European solidarity. And the guys at the International Monetary Fund and the European Union pack their bags and check flight schedules.

Before you know it, the defiant words have vanished, and the bailout has begun.

And yet so far, most of the discussion has been about when Portugal gets rescued. There has been very little talk about a far more important question -- whether it should be.

For more on this read at: http://www.bloomberg.com/news/2011-01-18/portuguese-bailout-will-make...

China pushes back on renewed U.S. currency calls

Chinese President Hu Jintao arrived in the United States on Tuesday for a four-day state visit peppered by U.S. complaints about Beijing's currency policies but sweetened by a series of business deals.

The White House weighed in on the dispute over the level of the yuan hours before Hu flew in, urging China to take more steps to allow its currency to strengthen.

"We believe that more must be done. That is an opinion that is held not just by this country but by many countries around the world," White House spokesman Robert Gibbs said.

For more on this read at: http://www.reuters.com/article/idUSTRE70H07Z20110118

Subbarao reiterates concern over inflation

Reserve Bank of India (RBI) governor D. Subbarao on Monday reiterated his concern over inflation a week before the next monetary policy review, which is expected to feature further tightening measures.

“For the Reserve Bank, the challenge is to calibrate monetary policy, taking into account the demands of inflation management and the demand of supportive recovery,” Subbarao said, addressing students at the Indira Gandhi Institute of Development Research (IGIDR).

The apex bank is forecast to raise the key policy rates by at least 25 basis points at its 25 January review.

RBI raised the key rate six times in 2010 to 6.25% but that hasn’t succeeded in reining in food prices.

For more on this read at: http://www.livemint.com/2011/01/17230938/Subbarao-reiterates-concerno...

RBI may define good, bad years, adjust bank provisioning norms

The Reserve Bank of India (RBI) may define good and bad years for banks, based on certain economic indicators, to determine how much provisioning they should make for bad debts, according to two people familiar with the matter.

This is part of the move by RBI to align banks with Basel III norms, which offer guidance on various operational issues, including capital adequacy.

As per the norms, it is a macroprudential issue to set aside more capital when the economy and profitability is good and use those extra provisions when these are not performing as well.

For more on this read at: http://www.livemint.com/2011/01/17213855/RBI-may-define-good-bad-year...

In record rush for funds, PE firms may findthe going tough

At least 117 private equity (PE) and venture capital funds are on the road to raise money to invest in India, signifying the growing importance of the world’s 10th largest economy for foreign investors.

Although this is a record high of funds in the market, many fund managers may fail to raise money in an overcrowded market, analysts said.

The funds are raising $33.5 billion (Rs.1.5 trillion) and there is already close to $17 billion undeployed capital waiting to be invested in India. So, investors fear more fund-raising will worsen the capital overhang.

For more on this read at: http://www.livemint.com/2011/01/17231010/In-record-rush-for-funds-PE-...

Sebi asks FIIs to monitor PN beneficiaries

Capital market regulator the Securities and Exchange Board of India (Sebi) has put the onus on foreign institutions, which issue participatory notes, to keep a tab on the final beneficiary of this derivatives instrument. The move, which is part of the regulator to get foreign institutions to comply with ‘Know Your Client’ (KYC) requirements, follows instances where a couple of participatory note-issuing institutions failed to provide exact details of the ultimate beneficiary.

Indian regulators suspect that participatory notes, a derivatives instrument that allows foreigners to invest in Indian stocks without registering with the authorities here, are being misused to rig the stock market with unaccounted funds from overseas.

The securities market regulator, in a circular on Monday, directed foreign institutions to declare, in their regular report filings, that the person to whom the participatory note is issued and the beneficial owners, comply with the regulations.

“The revised undertaking has two effects, it technically removes the restriction on issuance of ODIs to non-resident Indians (NRIs) and introduces the concept of beneficial ownership for being compliant with Sebi regulations,” said Divaspati Singh of Nishith Desai Associates.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

January 17,2011

Euro zone finance ministers to discuss changes to rescue fund

(Reuters) - Euro zone finance ministers discussed on Monday having more money in their rescue fund and cheaper emergency loans as part of a package of measures to end the sovereign debt crisis, but they made no firm decisions.

The chairman of euro zone finance ministers, Jean-Claude Juncker, said the ministers discussed many possible options under the package, but favored none at this stage.

"We started discussions on a comprehensive package of measures to stabilize the euro zone. These talks have to continue," Juncker said after a monthly meeting of the finance ministers.

He vowed to accelerate work on the package, but was careful not to commit to being ready in time for the February 4 or March 24-25 European Union leaders' summits.

"I wouldn't give a date for conclusion of our work, but the work will be done at the highest speed possible," Juncker said.

He said the ministers discussed a European Commission proposal to increase the effective lending capacity of the euro zone rescue fund, the European Financial Stability Facility (EFSF) to 440 billion euros, from about 250 billion now.

For more on this read at: http://www.reuters.com/article/idUSTRE70F1WP20110117?pageNumber=1

Hu Says U.S. Must Respect Sovereignty, Defends Yuan

Chinese President Hu Jintao said greater cooperation with the U.S. on economic and security issues must include recognition of each nation’s sovereign rights as he rejected American arguments for yuan appreciation.

Hu, who will arrive in Washington tomorrow for a state visit, said the two nations should abandon the “zero-sum Cold War mentality.” He cited trade, energy and terrorism as areas for strengthening cooperation, according to a transcript of answers to written questions from the Wall Street Journal and the Washington Post.

“We should respect each other’s sovereignty, territorial integrity and development interests,” Hu said. Inflation can’t be the “main factor” in determining yuan gains, he said, after U.S. Treasury Secretary Timothy F. Geithner said Jan. 12 that higher prices in China will lead to “necessary” exchange rate adjustments.

For more on this read at: http://www.bloomberg.com/news/2011-01-16/rise-in-yuan-won-t-curb-infl...

EU Begins Rescue Revamp as Germany Signals Flexibility

Europe’s top-rated countries grappled with how to strengthen the 750 billion-euro ($1 trillion) rescue fund for debt-hit states as Portugal insisted it will get by without an aid package.

Finance ministers from Germany, France and four other countries with AAA credit ratings held a hastily scheduled meeting to discuss how to boost the financial firepower of the fund without pushing up their own borrowing costs.

The goal is to bolster the euro’s defenses “without putting too much of a burden on the partners,” Austrian Finance Minister Josef Proell told reporters before the session, to be followed by the monthly meeting of all 17 euro-area ministers.

A rising euro and successful bond auctions in Portugal, Spain and Italy offered a respite last week from market pressure for steps that go beyond the emergency aid program and the European Central Bank’s unprecedented bond purchases.

For more on this read at: http://www.bloomberg.com/news/2011-01-17/eu-ministers-begin-talks-on-...

Govt decision on Cairn-Vedanta deal likely in few weeks

The Government is likely to take a decision on the $9.6-billion Cairn-Vedanta deal in the next few weeks and that the decision would be taken on merits, a top official said.

“There is absolutely no delay on the part of the Government regarding the Cairn-Vedanta deal. We will come to a decision on this (deal) in the course of the next few weeks. The decision will be taken on merits,” oil secretary, S. Sundareshan, told reporters here on Monday.

The Anil Agarwal-promoted London-based Vedanta is acquiring a majority stake in Cairn India from Edinburgh-based Cairn Energy for a consideration of up to $9.6-billion.

Cairn India is a three-way joint venture with Cairn, domestic oil and gas major ONGC and Petronas of Malaysia. Presently, the Edinburgh-based Cairn Energy holds a 62.37% stake in Cairn India.

For more on this read at: http://www.livemint.com/2011/01/17143346/Govt-decision-on-CairnVedant...

7 banks underwrite Tata Steel’s plan to raise funds

Seven investment banks have underwritten Tata Steel Ltd’s proposal to raise Rs.3,385.80-3,477 crore from the public by issuing 57 million shares in the price band of Rs.594-610.

The underwriters will ensure that India’s largest steel maker raises the entire sum by buying all unsold shares.

Each of the seven banks will buy unsold shares of up to Rs.557.14 crore—which add up to Rs.3,899.98 crore—surpassing the company’s target through the issue that will be open between 19 and 25 January.

The seven bankers are Kotak Mahindra Capital Co. Ltd, Citigroup Global Markets India Pvt. Ltd, Deutsche Equities India Pvt. Ltd, HSBC Securities and Capital Markets (India) Pvt. Ltd, RBS Equities India Ltd, Standard Chartered Securities (India) Ltd and SBI Capital Markets Ltd’s parent State Bank of India.

For more on this read at: http://www.livemint.com/2011/01/16210056/7-banks-underwrite-Tata-Stee...

Global cues to dominate undertone

Indian stock markets tanked during the last week on broad-based selling by funds and traders as rising inflation quickened fears of interest rate hike by the Reserve Bank of India. Moreover, there was disappointment over the IIP (Index of Industrial Production) data for November as it was significantly below market’s expectations.

India’s annual industrial output in November grew 2.7%—at its slowest pace in 18 months. The growth was significantly below the 11.3% annual growth in the previous month and forecasted growth of 6.6%. The weak growth can be attributed to the end of the festive season in India, when many factories close during the Diwali holiday. The low number may also be due to a high base effect from the period in the previous year.

The slow pace of industrial production and galloping inflation could become a serious threat to the Indian economy. The worst of all was the spurt in weekly food inflation and monthly wholesale price index numbers, which shot up to 8.43% in December from 7.48 in the preceding month. Overall, it was a bad week on bourses with key indices falling about 4.25%. The beginning of the big-ticket earnings season was also not on expected lines as Infosys Technologies Ltd’s revenue guidance disappointed, though its actual numbers were broadly in line.

For more on this read at: http://www.livemint.com/2011/01/16204542/Global-cues-to-dominate-unde...

The impact of higher interest rates on the BSE-500

This year has seen a sharp correction in Indian equity markets. The bellwether Sensex index on the Bombay Stock Exchange shed around 9% from its high of 20,621 points in a fortnight. The fear of interest rate hikes to rein in inflation and its consequent impact on corporate growth and profitability looms large over the markets.

Data analysis of the BSE-500, excluding banks and oil, companies shows that interest cover, or ratio of profits earned to interest cost, in fiscal 2010 at 2.33 was higher than 2.19 in the previous year and the low of 1.89 in 2001.

Improved interest cover in the last two years implies one positive trend—a higher operating profit growth compared with the growth in interest costs. But 2010 figures were not as robust as those in fiscal 2005 to 2008, the most robust years in revenue and profit growth for the Indian corporate sector.

For more on this read at: http://www.livemint.com/2011/01/16205034/The-impact-of-higher-interes...

January 16,2011

Could the U.S. central bank go broke?

(Reuters) - The U.S. Federal Reserve's journey to the outer limits of monetary policy is raising concerns about how hard it will be to withdraw trillions of dollars in stimulus from the banking system when the time is right.

While that day seems distant now, some economists and market analysts have even begun pondering the unthinkable: could the vaunted Fed, the world's most powerful central bank, become insolvent?

Almost by definition, the answer is no.

As the monetary authority, the central bank is the master of the printing press. It can literally conjure up money at will, and arguably did exactly that when it bought about $2 trillion of mortgage-backed securities and U.S. Treasuries to push down borrowing costs and boost the economy.

For more on this read it: http://www.reuters.com/article/idUSTRE7096FE20110111

India to join OECD to pace efforts to check tax evasion

India may soon join ranks with top world economies by becoming a member of the Organisation for Economic Cooperation and Development (OECD) and speed up its efforts to trace black money in foreign shores and tighten anti-money laundering regulations.

Sources in the Finance Ministry, engaged in deliberations with the top world economic body, said India’s chances have been boosted after the country was inducted as a full-member of another such elite body -- the Financial Action Task Force (FATF) last year, and an entry to the new elite club of economies is expected soon.

For more on this read it: http://www.livemint.com/2011/01/16143836/India-to-join-OECD-to-pace-e...

Citi to compensate for alleged fraud in Gurgaon

Citibank said on Saturday it had begun the process of working towards fair compensation for customers affected by an alleged employee fraud at its branch in Gurgaon on the outskirts of the capital.

The bank said the process of compensation will happen over a period of time and that it will continue to support the investigating authorities fully until the matter is resolved.

”As we have stated earlier, Citi identified suspicious transactions at our Gurgaon Branch in early December and immediately reported the matter to law enforcement and regulatory authorities,” the company said in a statement.

For more on this read it: http://www.livemint.com/2011/01/16114056/Citi-to-compensate-for-alleg...

Sensex slips from 19k level, worst week since May

New Delhi: Markets posted their worst weekly loss in eight months tumbling to four-month closing lows in volatile trade on Friday, after accelerating monthly inflation cemented rate hike fears, sending financials lower.

Adding to investor’s gloom were disappointing results from software services bellwether Infosys Technologies over rising prices. Both the benchmark indices slumped to their lowest level last seen in November 2010 with the prospect of tighter monetary policy stance in the forthcoming policy review scheduled on 25 January.

Annual inflation rose significantly in the month of December, the wholesale price index (WPI) surged to 8.43% compared with 7.48% for the previous month.

For more on this read it: http://www.livemint.com/2011/01/14152452/Sensex-slips-from-19k-level-...

Analysts expect another subdued week at Dalal Street

Markets are likely to slide further next week as third quarter earning numbers of corporate are unlikely to bring any “great surprises” to Dalal Street, experts said.

Stock markets have witnessed an extremely disappointing start to the year 2011, as the bellwether Sensex has plummeted over 8% in the first two weeks of the year.

Market analsyst feel that the testing time is still not over for the Dalal Street with rising inflation playing a major spoilt sport.

“After a really bad start to 2011, one would have thought there will be some bounce back. But weaker than expected IIP data coupled with the rise in inflation were the main culprits this week.

For more on this read it: http://www.livemint.com/2011/01/16120532/Analysts-expect-another-subd...

Being Force Merger

Both inbound and outbound M&As in India grew manifold last year, and experts say 2011 will be an even bigger draw, finds Sunanda Poduwal

THE HUNTED became the hunters in 2010. India Inc saw a spurt in outbound mergers and acquisitions in 2010, driving home the point that Indian companies are keen to make up for lost time. The biggest outbound transaction was Airtel’s $10.7 billion acquisition of Zain Africa to explore new markets, which took the years total outbound transaction value to $ 21.31 billion across 187 transactions. The total M&A transaction value in the year 2010 was close to the $50 billion mark across 623 transactions, inching towards the benchmark year of 2007.

“The outbound action will be hotter in 2011 though deal valuations might still not be as high as in 2007,” says Nikhil Nath, managing director and head, M&A, Asia at Nomura. The race for acquiring companies outside is being fuelled by India’s hunger for resources as the country tries to regain its 8-9 percent growth rate. In March 2010, Essar acquired US-based Trinity Coal for $600 million to feed its steel units in America. In December, Lanco acquired Griffin Coal Mining in Australia and RIL acquired equity interest in three shale gas assets in US.

For more on this read it: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Five world markets themes next week

Following are five big themes likely to dominate thinking of investors and traders in the coming week and the Reuters stories related to them.

1) GREAT EXPECTATIONS

Risk premia on assets of the euro zone's more highly-indebted sovereigns have eased from record highs but whether that trend continues will depend on European finance ministers, who meet in Brussels on Monday and Tuesday. What they decide and how much detail they can agree on will be crucial. Any sign of a consensus on expanding the European Financial Stability Facility and firm proposals to buy back peripheral sovereign debt from secondary markets could have the desired stabilizing effect but risks putting pressure on German Bunds, given it would reinforce concerns that Europe's biggest economy will have to shoulder the lion's share of the burden of any enlarged rescue fund. In the absence of significant supply from the euro zone peripheral issuers and given a more hawkish than expected European Central Bank, a German auction of two-year bonds on Wednesday could struggle to be absorbed in the market with low yields against a background of a stronger economic outlook.

2) THE PRICE OF MARKET ACCESS

The euro zone's most indebted sovereign issuers have drawn healthy demand for their first bond auctions of the year, but at a price. Funding costs are elevated, leaving investors cautious about the sustainability of such financing. Western European credit default swaps widened past lower-rated central and eastern European states a few days ago, highlighting lingering market nervousness about the potential of a debt default in the euro zone. Portuguese 10-year average yields at this week's auction were still close to the 7 percent that Lisbon has said in the past would be unsustainable while funding costs at Spain's five-year debt sale jumped 100 basis points compared with the previous auction - locking in higher refinancing costs. Markets will be mindful of this when Spain next comes to the market in the coming week with a sale of three- and 15-year bonds.

For more on this read it: http://www.reuters.com/article/idUSTRE70D43Q20110114

Investors crave more strong bank results

U.S. bank stocks are flying high, and next week's earnings could give investors more reason to be optimistic about the sector.

Strong results from JPMorgan Chase & Co on Friday bolstered expectations for top U.S. banks, many of which are due to report next week, including Citigroup and Goldman Sachs.

Financials have been among market leaders in the recent rally, with the Standard & Poor's 500 posting its seventh straight week of gains on Friday.

While the earnings outlook is keeping alive hopes that stocks have more room to run higher, the rise in bank shares has pushed sector indexes to near resistance levels, which could signal a rest stop for the shares in the holiday-shortened week.

For more on this read it: http://www.reuters.com/article/idUSTRE70D7MZ20110115

Wall St bets against Whitney's dire view on municipal debt

(Reuters) - Top fund managers are challenging the bleak forecast for the U.S. municipal bond market by Wall Street analyst Meredith Whitney and are selectively buying high-quality bonds with robust return rates.

Whitney, who made her reputation by predicting in October 2007 that Citigroup would need a massive capital infusion, warned investors this week that as many as 100 U.S. cities and other municipal issuers would default on their debt this year.

Her comments contributed to a sell-off that drove yields on top-quality 30-year muni bonds to more than 5.0 percent on Thursday, near two-year highs. The muni market has been steadily declining since November on a combination of factors, including an oversupply of bonds.

For more on this read it: http://www.reuters.com/article/idUSTRE70D3D520110114

January 15,2011

ECB warns on inflation, seeks bolder crisis action

The European Central Bank's president warned Thursday that inflation may remain high for months, raising questions about the possibility of an eventual interest-rate hike, and urged governments to bolster measures to tackle the eurozone debt crisis.

Jean-Claude Trichet's comments came after the ECB left its main interest rate unchanged at 1 percent on Thursday for the 20th consecutive month.

The decision was expected although annual inflation in the 17-nation eurozone rose to 2.2 percent in December, above its target and a two-year high. The bank's mandate is to keep inflation "close to but below 2 percent."

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

Mixed results for Bank of Japan policy

About three months have passed since the Bank of Japan decided on a package of monetary easing measures and while there have been some positive effects, corporate demand for money has remained sluggish and the nation's escape from deflation still appears difficult.

In October, the central bank set up a 5 trillion yen fund to purchase not only government and corporate bonds but also high-risk assets, including exchange-traded funds (ETF). It is rare for a central bank to buy ETFs.

Bank of Japan Gov. Masaaki Shirakawa said the measures were meant to "guide interest rates lower and thus reduce companies' fund-procurement costs."

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

Wait for complete package on debt crisis: Merkel

German Chancellor Angela Merkel said on Saturday any measure to stabilize the euro should come within a complete strategic package, dampening hopes for a quick decision on moves to tackle the euro zone debt crisis.

Germany faces mounting pressure from the European Commission and its euro zone partners to strengthen a rescue fund for troubled member states, the European Financial Stability Facility (EFSF).

"If the discussion is about a further package of measures, it is above all important that we develop a complete strategy that must absolutely include closer economic coordination," Merkel told a news conference in Mainz after a meeting with other senior members of her ruling Christian Democrats.

"You cannot simply raise another particular aspect each day," she added.

For more on this read at: http://www.reuters.com/article/idUSTRE70E1AQ20110115

ECB's Smaghi says Ireland triggers new stress tests: report

Europe needs to do a new round of stress tests on banks after Ireland's flawed vetting of lenders in 2010 raised doubts about a parallel Europe-wide health check, a European Central Bank executive board member was quoted as saying.

"Unfortunately the fact that the Irish stress test turned out not to be credible affected the credibility of all the other stress tests," Lorenzo Bini Smaghi said in an interview in Saturday's The Irish Times newspaper.

"This is why we need a new round of stress tests with more peer review and control on what national authorities are doing."

EU leaders agreed on a new review of the region's banks late last year as part of efforts to win back confidence of financial markets. The tests will begin in February.

For more on this read at: http://www.reuters.com/article/idUSTRE70E0XP20110115

J.P. Morgan results bode well for sector earnings

J.P. Morgan /quotes/comstock/13*!jpm/quotes/nls/jpm (JPM 45.08, +0.21, +0.47%) reported fourth-quarter net income of $4.8 billion as investment-banking fees remained strong and provisions for bad loans fell. Read more about J.P. Morgan.

J.P. Morgan is the first major U.S. bank to report fourth-quarter results. The company is a big player in all of the major banking businesses, including investment banking and trading, retail banking, credit cards, mortgages, commercial lending, treasury and securities services and asset management. U.S. Week Ahead: Citi and Apple

U.S. corporate earnings season gets into full gear next week, with headline results from Goldman Sachs, Citi, Bank of America and Apple.

That means its results are closely watched for clues on how rivals performed in the same period.

For more on this read at: http://www.marketwatch.com/story/jp-morgan-results-bode-well-for-sect...

Euro paces best week since March 2009; gains ahead

The euro headed for its best week in more than 1-1/2 years on Friday and could extend gains next week after successful securities auctions by indebted euro zone members calmed fears of a credit crisis in the region.

The euro was last at $1.3374, up 3.8 percent this week and edging closer to key resistance at $1.35. Analysts said the recovery could continue in the near term, though gains above $1.35 may be difficult given nervousness over large debt supply from weaker euro zone economies in 2011.

For now, demand for Portuguese and Spanish debt and expectations for higher euro zone interest rates have eradicated most concerns of fiscal woes on the euro zone periphery.

For more on this read at: http://www.reuters.com/article/idUSTRE70A27320110114

Fed Officials Say Strengthening Economy Doesn't Alter Bond-Purchase Plans

Federal Reserve policy makers said the central bank needs to bring down unemployment by pressing on with record monetary stimulus even as the economy shows signs of gaining strength.

Boston Fed President Eric Rosengren predicted in a speech yesterday that under current policy, it will take several years to reach full employment and an inflation rate of about 2 percent. Governor Daniel Tarullo told CNBC that “I haven’t seen anything which would warrant a reconsideration” of the Fed’s plans to buy $600 billion of Treasuries through June.

The comments capped a week of remarks by central bankers indicating no change to a policy that has prompted the strongest political backlash in three decades. Fed Bank of St. Louis President James Bullard said in an interview this week that while the U.S. growth outlook has improved after a “strong” holiday shopping season, he wants to see more evidence before considering reducing or slowing the stimulus.

For more on this read at: http://www.bloomberg.com/news/2011-01-15/fed-officials-say-strengthen...

HDFC profit rises 32.71% on sale of IL&FS stake

Housing Development Finance Corp. Ltd (HDFC), India’s largest mortgage company, posted a 32.71% rise in net profit in the December quarter, riding on income from the sale of a part of its investment in Infrastructure Leasing and Financial Services Ltd (IL&FS).

IL&FS is a finance company promoted by HDFC along with Central Bank of India and the erstwhile Unit Trust of India (UTI).

Profit rose to Rs.890.88 crore in the quarter ended December from Rs.671.25 crore in the year earlier.

Excluding the sale of the 10% IL&FS stake, profit growth is 16.74%. The year-ago figure includes a Rs.51.38 crore profit on investments.

For more on this read at: http://www.livemint.com/2011/01/14213606/HDFC-profit-rises-3271-on-sa...

Inflation at 8.43%, rate hike looms

India’s inflation rate accelerated by almost a percentage point in December, increasing pressure on the Reserve Bank of India to hike key interest rates in its monetary policy review due later this month.

The wholesale price index (WPI) rose 8.43% in the month from a year ago, government data showed on Friday. The index was at 7.48% in the previous month.

"This is generalized inflation," Jahangir Aziz, chief economist at JP Morgan said, adding "the sheer size of demand in the economy is a major cause."

The benchmark stock index, Sensex, fell 322.38 points or 1.68% after the government released the inflation data. This was the first time in about four months that the index closed below 19,000 points. Bond yields rose sharply in anticipation of a sharp increase in key rates.

For more on this read at: http://economictimes.indiatimes.com/news/economy/indicators/inflation...

Sensex declines 10% from peak on interest rates concern

India’s stocks fell, dragging the benchmark index 10% below its November record, amid concern rising prices will erode profit growth and prompt the central bank to raise interest rates.

Tata Motors Ltd, the nation’s biggest truck maker, dropped for the first time in three days. Inflation and rising commodity prices are major challenges, Finance minister Pranab Mukherjee said on Friday after a government report showed the pace of price increases accelerated last month. Steel Authority of India Ltd (SAIL), the country’s second largest producer, sank to its lowest level in more than 14 months after saying higher costs contributed to a 34% slide in quarterly net income.

“Inflation is a big concern,” said Rajat Jain, chief investment officer at Principal Pnb Asset Management Co. in Mumbai, who oversees the equivalent of $1.3 billion (Rs.5,889 crore) in assets. There could be some earnings downgrades by analysts.

For more on this read at: http://www.livemint.com/2011/01/14204740/Sensex-declines-10-from-peak...

No Instant Solution To Food Security

Poltics is the art of the possible. Harsh as it might sound, ensuring food security is also about distinguishing between what is possible (and feasible) and what is not. Yes, it is tragic that more than six decades after independence we are unable to provide food security to all our people and so many Indians should be so woefully undernourished. But it would be even more tragic if we allowed our judgement to be clouded by sentiment and blindly accepted the National Advisory Council’s (NAC) proposals without doing the necessary ground work to ensure they get translated into food security on the ground. Given the sorry state of our public distribution system in all but a few states, any attempt to channelise food to the needy without revamping the present system will only result in massive leakages with few of the genuinely needy benefiting. A ready parallel is with the Right to Education Act wherein education has been made a fundamental right; but only on paper, as we have no way of delivering on it. Legal entitlements are meaningless if they remain on paper.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

January 14, 2011

New Year’s hope against hope

The biggest hope for sparking economic recovery in the US and Europe lies in writing down the debts of homeowners and, in some cases, governments, says Joseph E Stiglitz The time has come for New Year’s resolutions, a moment of reflection. When the last year hasn’t gone so well, it is a time for hope that the next year will be better. For Europe and the United States, 2010 was a year of disappointment. It has been three years since the bubble broke, and more than two since Lehman Brothers’ collapse. In 2009, we were pulled back from the brink of depression, and 2010 was supposed to be the year of transition: as the economy got back on its feet, stimulus spending could smoothly be brought down.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Europe financing: Sovereign crisis, sovereign solution

Could cash-rich sovereign wealth funds solve the euro area's debt crisis?

Reeling from the financial crisis and facing potential funding shortfalls, western banks turned to sovereign wealth funds (SWFs) for support during the credit crunch. In 2007 and 2008, these funds, mainly from Asia and the Middle East, pumped some US$70bn into the ailing institutions.

Some made money on these investments--such as funds from Kuwait and Singapore on purchases of Citigroup shares and the SWFs from Qatar and Abu Dhabi on stakes in Barclays and Credit Suisse--but most are sitting on large losses, if they have not already realised painful write-downs. Still, the funds proved themselves willing to invest where others feared to tread. Bank of Ireland is reportedly now in talks with SWFs in the Middle East about plans to raise fresh capital.

On state visits around Europe this month, Li Keqiang, China's deputy prime minister, made headlines by suggesting that China stood ready to support the debt of the euro area's troubled peripheral members. "China has confidence in Spain's financial market", Mr Li wrote in El País ahead of his visit to Madrid. "It has purchased Spanish Treasury bonds and will buy still more".

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

Europe Failed to Clear 'Skepticism' on Debt Crisis, IMF Says

Europe has yet to allay investor “skepticism” about the sustainability of the region’s debt, and any spread of the crisis would cloud the global economic outlook, the International Monetary Fund’s No. 3 official said.

“At least for now it looks like the spillover from the European sovereign crisis to areas outside of the region will be limited,” Naoyuki Shinohara, deputy managing director at the IMF, said in an interview in Tokyo yesterday. “However, if the European sovereign-debt problems were to become bigger, we need to keep in mind that that could bring about considerable downside risks.”

European officials have indicated they’re ready to expand their efforts to contain the crisis that erupted last year and has led to bailout packages for Greece and Ireland. German Chancellor Angela Merkel this week expressed willingness to take whatever steps are needed to stem the turmoil.

The extra yields investors demand to hold Greek and Irish bonds rather than German bunds “still remain very high, despite the rescue packages,” Shinohara said.

For more on this read at: http://www.bloomberg.com/news/2011-01-14/europe-failed-to-clear-skept...

World Bank sees capital-flow risks, global growth slowing in 2011

Capital inflows, a driving force of the recovery in emerging countries, now pose risks to global growth as they can trigger abrupt currency fluctuations that may do lasting damage to some nations, the World Bank said.

The Washington-based institution on Wednesday left a growth forecast for the world’s economy this year unchanged at 3.3%, from a revised 3.9% in 2010. It predicted that the slowdown, which reflects capacity constraints in developing nations and restructuring in developed economies, will be followed by faster growth of 3.6% in 2012.

“The pickup in international capital flows reinforced the recovery in most developing countries,” Hans Timmer, the World Bank’s director of development prospects, said in a press release on Wednesday. However, heavy inflows to certain middle-income economies may carry risks and threaten medium-term recovery, especially if currency values rise suddenly or if asset bubbles emerge.

For more on this read at: http://www.livemint.com/2011/01/13212152/World-Bank-sees-capitalflow-...

Govt’s inflation sops not a runaway hit

The government on Thursday announced a series of measures to tame food inflation but said it has limited leverage over vegetables and fruits, soaring prices of which have fuelled the current round of inflation. A statement issued by the Prime Minister’s Office said the government would review export and import of all essential commodities regularly and initiate stringent action against hoarders and black marketers. It directed public sector units to intensify purchases of essential food items, such as pulses and edible oils, for distribution through their retail outlets at subsidized rates. The government also asked agri cooperative Nafed to undertake sale of onions at Rs 35 a kg. Onion prices have been a big factor in pushing up the food inflation.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Food inflation unacceptably high: FM

New Delhi: Terming food inflation as unacceptably high, finance minister Pranab Mukherjee on Friday said he will meet his state counterparts on 19 January to discuss ways to rein in the rising food prices.

“Food inflation at this level is not acceptable and we are trying our best to control it along with the cooperation of state governments,” Mukherjee told reporters here.

He said he would be meeting the state finance ministers on 19 January to discuss among other issues, price rise.

Food inflation fell for the first time in six-week to 16.91% for the week ended 1 January, but still remains high as vegetables like onion, and protein-based items turned expensive.

For more on this read at: http://www.livemint.com/2011/01/14133016/Food-inflation-unacceptably-...

Infosys third quarter earnings disappoint, sends stocks tumbling

A tepid 2.3% quarterly increase in revenue and a 2.5% increase in net profit (both in rupee terms) for Infosys Technologies Ltd failed to enthuse the markets, sending the stock tumbling and dragging the Bombay Stock Exchange’s (BSE) Sensex down 1.8% to close at 19,182.82 points.

Infosys is perceived to be a weather vane for the fortunes of India’s $60 billion (Rs.2.7 trillion) information technology (IT) outsourcing industry. India’s second largest IT exporter ended 4.82% down at Rs.3,212.30 on BSE.

The firm reported quarterly revenue of Rs.7,106 crore and net profit of Rs.1,780 crore. However, the continued slow pace in the recovery of the key US and European markets—from where it gets the bulk of its revenue—led the firm to give a cautious outlook. Infosys counts Goldman Sachs, BP Plc, BT Group Plc, ABN Amro and Deutsche Bank AG among its clients.

While quarter-on-quarter (q-o-q) operating margins came in flat at 30.2%, volume growth was 3.1%. The results disappointed analysts as consensus numbers had estimated profit at Rs.1,815-1,830 crore and revenue at around Rs.7,200 crore.

For more on this read at: http://www.livemint.com/2011/01/13224310/Infosys-third-quarter-earnin...

Rupee weakens on stocks slide, inflation

Mumbai: The rupee weakened on Friday as a sharp sell-off in domestic shares coupled with demand for the US unit to swap for euros after the single currency’s global rally, weighed on the local unit.

Traders said dollar demand for some defence-related purchases also exerted downward pressure on the rupee.

The partially convertible rupee closed at Rs. 45.37/38 per dollar, 0.3% weaker than its Rs. 45.24/25 close on Thursday, when it rose as much as Rs. 45.04 - its strongest since 4 January. The rupee moved in a wide band of 45.1425 to 45.44.

“I think the kind of volatility we saw recently will continue. Lots of things happening -- inflation, high interest rates, growth worries, among other things,” said Ananth Narayan G., head of fixed income, currencies and commodities at Standard Chartered Bank in Mumbai.

For more on this read at: http://www.livemint.com/2011/01/14093434/Rupee-weakens-on-stocks-slid...

Cabinet secy for multi-brand FDI

The country’s highest ranking bureaucrat has favoured foreign direct investment (FDI) in multi-brand retail saying it will help tame soaring food prices. Cabinet Secretary KM Chandrashekhar made the suggestion in a presentation to Prime Minister Manmohan Singh and his senior Cabinet colleagues in Delhi on Tuesday. “As a medium to long-term measure to improve distribution, foreign direct investment in multi-trade retail be allowed,” Chandrashekar said in his presentation on inflation and the possible measures that could rein it in. India currently allows 51% FDI in single-brand retail and 100% in wholesale cash-and-carry. The Cabinet secretary’s suggestion has come at a time when rising food prices have become a headache for the government. Although food inflation for the week to January 1 eased marginally to 16.32%, it remains far beyond the government’s comfort zone.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Banks may hold on to margins but provisions, NPAs set to rise

Banks are likely to hold on to their net interest margins (NIMs), but higher provisioning and an increase in non-performing assets (NPAs) will cast a shadow on their third-quarter results, which will start being unveiled next week, analysts said.

Banks dependent on wholesale deposits, or bulk corporate deposits at more than the usual deposit rates, such as Yes Bank Ltd could see their net interest margins (NIMs) falling more sharply than larger rivals such as State Bank of India (SBI), ICICI Bank Ltd and HDFC Bank Ltd, which have a higher ratio of cheap current and savings account (Casa) deposits.

NIM is the difference between interest charged on loans and that paid on deposits. Casa is the cheapest source of deposit for banks as they do not pay any interest on current accounts and only a minimum 3.5% interest on savings accounts.

Suresh Ganapathy, head, financial research team at Macquarie Securities Group, expects bank margins to be “flat to negative” in the quarter ended December.

For more on this read at: http://www.livemint.com/2011/01/13213046/Banks-may-hold-on-to-margins...

Govt mulls norms for Rs.1 trillion wealth management industry

The government is planning to regulate the Rs.1 trillion wealth management and investment advisory industry by making changes in the existing laws that govern financial sector regulation. The growing wealth management industry in the world’s 10th largest economy has remained a blind spot, not regulated by any of the five financial regulators in the country.

Since these financial advisers deal with different asset classes and tread different regulatory turfs, the norms for regulation will be worked out at a common forum such as the Financial Stability and Development Council (FSDC), according to two persons familiar with the discussions currently going on. FSDC is the apex body of regulators, headed by the finance minister.

The government is in talks with financial sector regulators such as the Securities and Exchange Board of India (Sebi), the Reserve Bank of India (RBI), the Insurance Regulatory and Development Authority, the Forward Markets Commission and the Pension Fund Regulatory and Development Authority (PFDRA) to make necessary amendments in their respective Acts and create specific provisions for regulating wealth management and investment advisers.

For more on this read at: http://www.livemint.com/2011/01/13224132/Govt-mulls-norms-for-1-trill...

January 13, 2011

Eurozone looks to ways of taming Portugal crisis

European governments are considering aid for Portugal, debt buybacks, lower interest rates on rescue loans and guarantees against excessive debt as part of a package to quell the financial crisis, according to two people with direct knowledge of the talks. The plan, which may include a loan to Portugal of about € 60 billion ($78 billion) and purchases of outstanding Greek debt, would mark an attempt to contain the crisis that has frustrated unprecedented efforts by policymakers to calm markets and raised questions about the health of the 17-nation euro economy. Euro-area finance ministers will discuss elements of the package next week, though the debate is so sensitive in Germany that decisions may wait until a scheduled summit of political leaders on February 4, said the people, who declined to be named because the deliberations are private.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Geithner warns China on policies

China’s currency is substantially undervalued and Beijing is moving too slowly to fulfill its promise to let it rise, treasury secretary Timothy Geithner said on Wednesday. Geithner said it is in China’s own interests to accelerate the pace of currency reform. He said the undervalued yuan is increasing the risk of inflation that will harm Chinese growth. Geithner addressed a range of economic policy issues at the centre of US-Chinese relations in a speech advancing Chinese President Hu Jintao visit to Washington next week. In addition to the currency issue, he mentioned widespread theft of US intellectual property in China, Beijing’s protection policies that hurt US exporters, and accusations that the government provides subsidies to Chinese businesses that violate World Trade Organisation rules.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Trichet Faces `Annus Horribilis' as Crisis Tests ECB

Jean-Claude Trichet’s final year at the helm of the European Central Bank may be his toughest yet as widening economic divergences within the euro area strain the bank’s one-size-fits all monetary policy.

With the sovereign debt crisis threatening to engulf Portugal and bond yields in debt-strapped nations near euro-era highs, Trichet must decide when to stop buying government assets, withdraw unlimited liquidity provision for banks and possibly even raise interest rates to stem inflation risks. His response to those challenges may shape his legacy by helping to determine the euro’s future.

“2011 could be another annus horribilis for the ECB,” said Ken Wattret, chief euro-area economist at BNP Paribas in London. “Stress in debt markets hasn’t diminished and the divergence between euro-area countries is getting bigger. It’ll be a big challenge for the ECB and a tough job for its president to negotiate an appropriate path for monetary policy.”

Trichet, who chairs an ECB policy meeting today, has been forced to take unprecedented steps to buy time for the euro as governments struggle to agree on how best to shore up confidence in the monetary union. The decision to buy government bonds split the ECB’s Governing Council, and some policy makers have warned that price stability, the bank’s primary goal, could be compromised if emergency measures are left in place too long.

For more on this read at: http://www.bloomberg.com/news/2011-01-13/trichet-faces-annus-horribil...

EU's New Drive to Contain Euro Debt Fire May Still Fall Short

European leaders enter year two of their fight to contain the euro region’s debt woes still struggling to put out the fire.

After committing almost $1 trillion, bailing out Greece and Ireland and asserting their determination to save the euro over the past 11 months, policy makers are returning to the drawing board after those previous efforts failed to pacify investors.

Their latest plan, elements of which will be debated when finance ministers meet next week, may extend help to Portugal, increase the size of their aid reserves, lower interest rates on bailout loans, and authorize purchases of outstanding bonds.

That still may not be enough, said Barton Biggs, managing partner of New York-based hedge fund Traxis Partners LP, who is “short” European securities, betting on their decline. He said officials should issue joint euro-region bonds, a measure opposed by Germany.

For more on this read at: http://www.bloomberg.com/news/2011-01-13/eu-s-new-drive-to-stamp-out-...

Cairn deal set to get govt nod by Feb

THE government is poised to clear the $9.6-billion Cairn-Vedanta deal by the middle of February ending five months of uncertainty over the controversial deal involving the transfer of India’s biggest onshore oilfield operated by the British explorer. The oil ministry has asked ONGC to stop obstructing the transaction and accept the fact that it is contractually bound to pay its partner’s share of royalty in the venture in which the state explorer was given 30% equity free of cost. State-run ONGC, hoping to renegotiate the contract, had declared it had pre-emptive rights and the deal could not be completed without its approval. The oil ministry, which had initially declared it would guard the interests of ONGC and was dragging its feet on the matter, was asked by the Prime Minister’s Office last week to take a quick decision. Vedanta chairman Anil Agarwal recently met Prime Minister Manmohan Singh and petroleum minister Murli Deora.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

It’s ‘worrying’ as IIP dips to 2.7%

THE industrial output growth plunged to an 18-month low of 2.7% in November, prompting Finance Minister Pranab Mukherjee to call the dip ‘worrying’. Independent experts, however, dismissed the fall, terming it a slight moderation and a data quality issue. They also backed a move to raise key interest rates to contain inflation. The factory output growth, as measured by the Index of Industrial Production, or IIP, was 11.3% in October. Economists had estimated the growth for November at 6.6%.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Work speeded up on new index

THE government is accelerating the rollout of a new Index of Industrial Production, or IIP, after several agencies voiced concern over the high volatility of the current index. The IIP measures factory output growth. A government-appointed panel, chaired by Planning Commission member Saumitra Chaudhury and comprising economic advisers of various ministries, is examining the new index, which has been prepared by the Central Statistical Organisation (CSO).

   "The report on the new index should be final within two weeks," a senior official familiar with the deliberations of the panel told ET.

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Steps to combat inflation to be announced soon: FM

Union finance minister Pranab Mukherjee said on Thursday there is no need for unnecessary panic on inflation.

Mukherjee said that the government will announce more steps to contain inflation later in the day.

Also Read | Food inflation stays high, rate hike seen

“Last evening, it (steps to check inflation) was finalized. I think it will be issued today,” he said answering questions on Wednesday’s meeting to check rising food prices.

For more on this read at: http://www.livemint.com/2011/01/13135100/Steps-to-combat-inflation-to...

IFRS to see firms revisiting Esop offers

With the deadline for India to move towards International Financial Reporting Standards (IFRS) less than three months away, analysts warn that companies will have to revisit their employee stock option plans (Esops) in order to avoid cumulative losses on their profit and loss (P&L) accounts.

In the first phase of IFRS convergence, companies listed on the stock exchanges, including those that trade on overseas exchanges and those with a net worth of Rs.1,000 crore, will adopt IFRS in the quarter beginning 1 April.

Under Indian GAAP (generally accepted accounting principles), Esops are accounted for at the intrinsic value of the stock options at the time they are granted by the employer. Under IFRS, stock options will be accounted for at fair value, which may be higher than the intrinsic value on the date the Esops are granted.

“Under IFRS, because of the cost that will now be required to be charged to the P&L account, companies may re-evaluate their option strategies and consider if granting of options needs to be somewhat reduced/rationalized,” said Jamil Khatri, executive director and head of accounting advisory services at audit and consulting firm KPMG in India.

For more on this read at: http://www.livemint.com/2011/01/11235502/IFRS-to-see-firms-revisiting...

January 12, 2011

Focus on RBI as growth slumps

New Delhi: Growth of factory output plunged to an 18-month low of 2.7% in November, triggering concerns about a phase of slower industrial activity and resurgent inflation.

Even as analysts were surprised at the extent of the slowdown, the growth numbers have served a poser to the Reserve Bank of India (RBI) ahead of its key monetary policy meeting on 25 January: Will RBI keep its eye on the poor industrial growth numbers or on containing growing inflationary pressures in the economy?

While growth was expected to slow down in the post-Diwali month especially because of a high base last year, the data surprised analysts and policymakers on the lower side.

For more on this read at: http://www.livemint.com/2011/01/12111310/Focus-on-RBI-as-growth-slump...

Pumping billions into wrong areas

It’s official: the world economy is completely upside down. What else is one to think as Europe goes hat-in-hand to developing China and feeble Japan? You would think China had better things to do with its cash than shore up a sinking euro zone. The same goes for Japan, where deflation and paralysis may soon deliver the sixth prime minister since September 2007.

Japan plans to buy bonds issued by Europe’s financial-aid fund, joining China in assisting a region battling a fast-spreading debt crisis. And does Europe ever need the help. Bailouts of Greece and Ireland merely pave the way to even bigger ones of Portugal, Spain and, perhaps, Italy.

It’s this last economy that should have officials in Beijing and Tokyo thinking twice about loading up on European debt. Yet, here’s something even bigger to consider: What the world really needs isn’t China’s and Japan’s excess cash, but more balanced and sustainable growth in Asia’s main economies. For more on this read at: http://www.livemint.com/2011/01/12192413/PUMPING-BILLIONS-INTO-WRONG-...

Should policymakers trust the IIP or the PMI numbers?

Which indicator should policymakers trust: the Index of Industrial Production (IIP) or the HSBC Purchasing Managers’ Index (PMI)? The IIP for November was the lowest reading this fiscal year. The manufacturing PMI for November, however, showed strong expansion.

Which indicator should we believe? The two measures are, of course, different, with IIP growth usually expressed in year-on-year (y-o-y) terms, while the PMI is a seasonally adjusted month-on-month (m-o-m) indicator. It’s also a survey-based indicator, with its numbers reflecting what proportion of the companies surveyed report higher/lower output, orders, inventory, etc, rather than a measure of production volume, as the IIP is. The IIP is subject to large fluctuations, partly on account of seasonal factors such as festivals and partly on account of the volatile capital goods component. For instance, the IIP for November was affected by the Diwali holidays and by the fact that Diwali was in October in 2009. To illustrate the importance of the base effect, consider the fact that the IIP would have to grow by 9.5% m-o-m in December 2010 in order to show a 0% y-o-y growth!

For more on this read at: http://www.livemint.com/2011/01/12205114/Should-policymakers-trust-th...

Malegam panel for loan rate cap, RBI regulation

The Malegam committee, set up by the Reserve Bank of India (RBI) to chalk out a framework within which microfinance institutions (MFIs) in India should operate, is set to recommend an upper ceiling for interest rates chargeable to poor borrowers, two persons familiar with the development said.

The panel also seems to be in favour of bringing in all for-profit microlenders under RBI regulations.

The committee is in the process of finalizing the report and may submit it to the central bank next week.

What the ceiling on the lending rate for MFIs could be is not immediately known, but persons familiar with the matter said it will be “reasonable”.

For more on this read at: http://www.livemint.com/2011/01/12235025/Malegam-panel-for-loan-rate-...

Sovereign default remains top 2011 risk for WEF

The risk that parlous government finances will trigger sovereign debt defaults remains one of the biggest threats facing the world in 2011, according to the World Economic Forum (WEF).

Punishing levels of public debt built up to counter the financial crisis have reduced the capacity of countries to handle further shocks to critically low levels, according the group’s closely watched 2011 Global Risks report.

“Current fiscal policies are unsustainable in most industrialized economies. In the absence of far-reaching structural corrections, there will be a high risk of sovereign defaults,” said Daniel Hofmann, chief economist at Zurich Financial Services, who contributed to the report.

For more on this read at: http://www.livemint.com/2011/01/12222939/Sovereign-default-remains-to...

What’s the way forward on GST?

M GOVINDA RAO Director NIPFP Implement it at the central level

   THOSE who cannot remember the past are condemned to repeat it, said philosopher George Santayana. The goods and services tax reform, like the value-added tax reform that took over 10 years to complete, is stalled like a bullock cart stuck in mud. Restarting the reform is a challenge but an opportunity for the finance minister to secure a place in history as a statesman.
   A two pronged strategy is needed to re-start the reform process. First, the FM can simply implement GST at the manufacturing stage at the central level in the forthcoming Budget itself and this does not require a constitutional amendment. It only requires the Centre to revisit the exemption list, unify the Cenvat rates and extend the tax to all services. With a common threshold and rate on both goods and services, the GST at the manufacturing stage becomes a reality. The threshold for both goods and services could be fixed at . 50 lakh of the manufacturing turnover and sales turnover respectively, and the tax may be levied at a uniform rate of 10%. A separate sumptuary tax can be levied on cigarettes.
   The second strategy comprises motivating the states to restart the reform process. This implies making compromises on the design and implementation. In fact, even some bad features may be included in the design to get the reform process moving. Thus, the states could tax at two rates instead of one and levy the tax at floor rates instead of fixed rates. Broadly, they may start with the floor rates of 5% and 10%, which is broadly the revenue-neutral rate. On sumptuary items, tobacco products, motor spirit, high speed diesel and a few items of luxury consumption, in addition to GST, the states may levy a special excise at the floor rates decided collectively.
   The Centre should fully compensate any shortfall in revenue estimated at the floor rates, including revenue from central sales tax, for the first three years. The reform could be implemented from April 2012. The progress in revenue collections should be monitored and in 2015, the rate structure could be realigned, if necessary. 

R SEKAR Former Jt Secy Ministry of Finance Continue dialogue with states

   ACONSENSUS on the goods and services tax continues to be elusive, despite the first discussion paper on the new regime. But the scope for any incremental change or transitional measures such as a GST at the central level is limited. At present, goods and services are taxed at 10%. Input credit is also available across goods and services. A tax on all services at this stage without any corresponding relief will only increase the tax incidence on goods. Lowering the small-scale threshold exemption from . 1.5 crore will hurt the small scale sector.
   The scope for incorporating GST features at the state level has become limited after the implementation of VAT. Many states, though, are agreeable to subsuming a number of state levies and harmonising tax rates and procedures. States may have some psychological comfort to move forward if they have the option to raise the floor rate within an agreed band. A flexible approach on exemptions may also be needed to start with.
   What is feasible at this stage is the adoption of procedural changes that are required for a national-level GST. Common registration, electronic filing of returns, e-payment, electronic monitoring of inter-state movement of goods, standard classification and so on should be done in the near term. A consensus is also needed on a common IT platform and the infrastructure should be in place ahead of the transition. The revenue impact of GST also needs to be assessed properly. Definite numbers are a must to convince stakeholders to switch to GST. This exercise has to be done in a transparent way in coordination with states and experts in the field. An assessment of the revenue implications will also be helpful.
   The Centre must keep the process of dialogue on with the states and respond to their concerns including apprehensions over the infringement of their autonomy. New Zealand, for instance, announced a relief package for sectors that would be impacted by GST, ahead of its introduction. Identifying and finding agreeable responses to issues through a dialogue is the only way forward. 

For more on this read at: http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=...

Spain economy: Feeling the pinch

The Spanish government and the country's central bank have announced a flurry of new measures over the past month, including further fiscal consolidation and structural reforms, in an effort to assuage investor concerns. However, despite these steps, the differential between yields on bench­mark German and Spanish ten-year bonds has continued to rise. The likelihood is that once Portugal bows to the inevitable and follows Greece and Ireland into accepting a financial bailout from the international community, the attention of financial markets will shift more closely to Spain, and in particular the state of the country's banking system.

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

China risk: Alert -- Policy-induced slowdown could overshoot

China has played a key role in supporting global economic growth over the past two years. However, the way in which this has been achieved, with massive credit expansion, has led to signs of an overheating economy, putting pressure on the government to bring the economy under control. The struggle to restrain asset prices and consumer price inflation is likely to lead to lower economic growth this year, and the risks are on the downside.

Credit boom

China's double-digit rates of GDP growth are less impressive when the method by which they have been achieved is borne in mind. The Chinese government is in a position of being able to direct the lending behaviour of its state-owned banks, and rolled out a massive economic stimulus package in 2009 that is now being wound down. Fiscal spending provided some of the stimulus, but most of it has come in the form of bank credit, with government policies (particularly, lower taxes on property purchases) being used to encourage Chinese citizens to take part in a credit-fuelled property boom.

For more on this read at: http://www.garp.org/news-and-publications/overview/story.aspx?newsId=...

January 10,2011

Goldman Sachs Traders Said to Prepare Own Hedge Fund

Two Goldman Sachs Group Inc. traders are preparing to start their own hedge fund after new financial regulations restricted banks from risking capital on speculative bets, said a person with direct knowledge of the matter. Ariel Roskis and Daniele Benatoff, who work for New York- based Goldman Sachs’s principal strategies desk in London, plan to start the fund in the second quarter, said the person, who declined to be identified before the plans are announced. The pair have secured a $300 million investment from Brummer & Partners, the largest Scandinavian hedge fund, the person said.

Goldman Sachs is losing traders as it moves to comply with a provision of the U.S.’s Dodd-Frank financial rules that prohibits banks from betting capital for their own accounts. Nine employees left in October to start a unit at private equity firm KKR & Co. that will invest in stocks. Pierre-Henri Flamand, the former head of Goldman Sachs’s Principal Strategies group, retired last year to start his own hedge fund.

For more on this read at http://www.businessweek.com/news/2011-01-10/goldman-sachs-traders-said-to-prepare-own-hedge-fund.html

China Currency Reserves Rise to Record $2.85 Trillion

China’s foreign-exchange reserves climbed by a record last quarter and lending exceeded the government’s annual target, increasing pressure on the central bank to tighten policies to rein in liquidity and inflation.

The currency holdings, reported by the central bank on its website today, rose by $199 billion to $2.85 trillion, the biggest quarterly gain since Bloomberg data began in 1996. Full- year yuan-denominated lending of 7.95 trillion yuan ($1.2 trillion) compared with a target of 7.5 trillion yuan.

The central bank may need to raise benchmark interest rates, boost reserve requirements for lenders and allow faster yuan appreciation, economists from Standard Chartered Plc and Credit Agricole CIB said. Policy makers may also experiment with more ways of encouraging outflows of capital, after expanding a program for exporters to park revenue overseas and letting some citizens invest directly abroad. For more on this read at http://www.businessweek.com/news/2011-01-11/china-currency-reserves-rise-to-record-2-85-trillion.html

January 9,2011

How inflation affects the Sensex

The inflation rate has started having an impact on the Sensex. The Sensex has started rocking because of the high inflation. With its widespread reach, inflation affects all aspects of the economy, and thereby the Sensex.

Last week, the markets fell after a sharp rise in food prices heightened concerns that the central bank may tighten the monetary policy more than expected. The financial stocks were among the big losers as higher interest rates could douse the demand for loans and squeeze the margins of banks.

The food price index rose 18.32 per cent in the 12 months to December 25, the highest in more than a year. The fuel price index climbed 11.63 per cent. In the prior week, annual food and fuel inflation stood at 14.44 per cent and 11.63 per cent respectively. The primary articles price index was up 20.20 per cent in the latest week, compared with an annual rise of 17.24 per cent a week earlier. The Wholesale Price Index, the most widely watched gauge of prices in India, rose 7.48 per cent in November from a year earlier, compared with 8.58 per cent in October.

For more on this read at http://economictimes.indiatimes.com/features/financial-times/how-inflation-affects-sensex/articleshow/7241924.cms

January 8, 2011

Bernanke and others express concern over US unemployment rates

Federal Reserve Chairman Ben S. Bernanke and two other policy makers forecast faster U.S. growth this year that still won’t reduce unemployment quickly, signaling the Fed will complete its monetary-stimulus plans.

A “moderately stronger” expansion in 2011, helped by consumer and business spending, doesn’t immediately change the “persistently high unemployment” that threatens the recovery, Bernanke said today in testimony to the Senate Budget Committee. Fed Governor Elizabeth Duke, speaking in Baltimore, and Chicago Fed President Charles Evans in Denver also voiced concerns about the labor market.

The joblessness, while helping to keep inflation low, may reinforce the decision of Fed officials to buy $600 billion in Treasuries through June. The central bankers spoke in the hours after the Labor Department reported that employers added 103,000 workers to payrolls last month, less than the 150,000 gain forecast by economists in a Bloomberg survey.

For more on this, read at http://www.bloomberg.com/news/2011-01-07/fed-officials-signal-they-will-complete-asset-purchases-on-jobless-concern.html

Bond Sales Set Record in U.S. as GE Leads $48.5 Billion: Credit Markets

Company bond sales in the U.S. reached a record this week and relative yields on investment- grade debt shrank to the narrowest since May as money managers boosted bets economic growth is gaining momentum. Issuance soared to $48.5 billion, eclipsing the $46.9 billion raised in the week ended May 8, 2009, as General Electric Co.’s finance unit sold $6 billion of notes in the largest offering in 11 months, according to data compiled by Bloomberg. Investment-grade bond spreads narrowed to 162 basis points, or 1.62 percentage points, more than Treasuries, Bank of America Merrill Lynch index data show.

Appetite for corporate debt is growing after annual sales topped $1 trillion for the second consecutive year as the securities return more than Treasuries. Service industries expanded at the fastest pace since May 2006, signaling the U.S. economy is poised to accelerate. While employers added fewer positions in December than forecast, the jobless rate has dropped to the lowest in 19 months.

For more on this, read at http://www.bloomberg.com/news/2011-01-06/bond-sales-set-record-in-u-s-as-ge-leads-48-2-billion-credit-markets.html

Looking to diversify, investors bet on catastrophes

Investors, still reeling from one disaster, are betting on the likelihood of another. Amid the volatility in the markets, wealthy individuals and big institutions are flocking to hedge funds that buy so-called catastrophe bonds and other investments tied to the probability of hurricanes in the Gulf Coast, earthquakes in Japan, large snowfalls in Canada and other natural disasters.

It is a diversification play, as investors continue to look for assets that do not move in tandem with equities and traditional fixed-income products.

A Credit Suisse hedge fund that specialises in insurance-linked securities has doubled, to more than $3 billion, since mid-2009. Early last year, the New Zealand Superannuation Fund, which manages and invests money for the country’s retirees, pledged $250 million to a hedge fund focused on catastrophe bonds and the like. And a new $80 million fund, started by an alumnus of the hedge fund Citadel, just listed on the London Stock Exchange.

For more on this read at http://economictimes.indiatimes.com/markets/global-markets/looking-to-diversify-investors-bet-on-catastrophes/articleshow/7239689.cms

January 7,2011

Chinese Yields Invert as Bond Shortage Outweighs Inflation

For the first time since 2008 Chinese companies are paying less to borrow for 15 years than for five, reflecting a shortage of longer-dated debt and confidence policy makers will curb inflation.

The average yield on yuan corporate debt maturing after 2025 was 4.67 percent in December, compared with 4.97 percent for three to five-year bonds, according to Bank of America Merrill Lynch’s China credit indexes. The last time the gap was wider was on Aug. 13, 2008, when the spread reached 31 basis points, or 0.31 percentage point.

For more on this, read at http://www.bloomberg.com/news/2011-01-06/yields-invert-as-bond-shortage-outweighs-inflation-china-credit.html

Is the Fed to blame for soaring all prices?

Here we go again: the spike in global oil prices that preceded the Great Recession is being repeated. Just three years ago, the price of oil futures on the New York Mercantile Exchange hit $100 a barrel for the first time ever, bringing dire warnings about looming economic hardship. Sure enough, the world economy entered its worst downturn since the Depression just months after oil prices peaked at a record $147 a barrel in July 2008. Now the doomsayers are back, as oil futures crept above $92 a barrel this week — their highest level since 2008.

Fatih Birol, chief economist at the Paris-based International Energy Agency, which represents the world's industrialized oil-consuming countries, warned on Monday that oil prices are expected to reach $100 a barrel again soon, threatening the economic recovery by hugely increasing the energy bills of countries, factories, cities and drivers.

The current spike in oil futures, say Birol and Jakob, is a product of excess supply — of speculative dollars, billions of which are flowing into U.S. commodities markets. "The investors are using their cards to their benefit," Birol told TIME on Thursday. "The way they're reading the market, they feel that when the U.S. recovers there will be a strong demand and a tightness" in oil supplies. Commodities investments in general have soared since August, when Federal Reserve Chairman Ben Bernanke announced the quantitative-easing program to boost the supply of investment capital. "Before the Fed announcement, net interest in crude oil was fairly neutral, but it has now climbed to the highest level ever," says Jakob. "The U.S. Fed is injecting about a trillion dollars into the economy in six months, and that liquidity has to go somewhere. Some of it has gone into commodities."

For more on this read at http://www.time.com/time/world/article/0,8599,2041139,00.html#ixzz1ALWloP4F

Deals

M&A

January 24, 2011

Sara Lee Said to Get Apollo Bid Close to $20 a Share

Sara Lee Corp. received a takeover bid from Apollo Global Management LLC, Bain Capital LLC and TPG Capital that is higher than the food company’s most recent closing share price of $18.70, said three people with knowledge of the matter.

The offer gets close to the $20 a share that Sara Lee’s board is seeking, said one of the people, who declined to be identified because the process is private. JBS SA, the Brazilian meat processor, is considering a revised bid backed by Blackstone Group LP, the people said. Downers Grove, Illinois- based Sara Lee has a market value of about $12 billion.

For more on this, read at http://www.businessweek.com/news/2011-01-24/sara-lee-said-to-get-apollo-bid-close-to-20-a-share.html

Rock-Tenn to Acquire Smurfit-Stone for $3.5 Billion

Rock-Tenn Co. agreed to buy Smurfit- Stone Container Corp. for $3.5 billion, making it North America’s second-biggest containerboard producer as demand rebounds.

Rock-Tenn bid $35 a share in cash and stock for Chicago- based Smurfit-Stone, Norcross, Georgia-based Rock-Tenn said today in a statement. The proposed transaction was approved by the boards of both companies, Rock-Tenn said.

The deal will expand Rock-Tenn’s operations to the U.S. Midwest and West Coast, allowing it to benefit from rising prices and increased consumption of containerboard. Demand for the specialized paper, used to make shipping boxes, revived last year as the global economy emerged from a recession.

For more on this, read at http://www.businessweek.com/news/2011-01-24/rock-tenn-to-acquire-smurfit-stone-for-3-5-billion.html

January 11,2011

IGate’s Bid for Rival Patni Fuels Expansion Concern

IGate Corp.’s $1.22 billion offer to buy larger Indian rival Patni Computer Systems Ltd. is fueling concern the company is expanding beyond its means.

IGate tumbled 11 percent yesterday in Nasdaq Stock Market trading after saying it may take on as much as $700 million in debt and sell as many as 10 million new shares to fund the purchase of as much as 84 percent of Patni. The 503.50 rupee-a- share offer was 9.4 percent higher than Patni’s closing price on Jan. 7 and led Noble Financial Group Inc. to cut its investment rating on IGate to “hold” from “buy.”

IGate may take on debt for the first time since 2001 after offering the equivalent of four times its total assets to buy Patni. The takeover would help IGate triple sales and add more than 15,000 workers in the world’s largest technology- outsourcing market as companies worldwide resume spending on computers and technology services.

For more on this read at http://www.businessweek.com/news/2011-01-11/igate-s-bid-for-rival-patni-fuels-expansion-concern.html

January 9, 2011

Duke Energy in advanced deal talks with Progress

US based Duke Energy is all set to acquire its peer Progress Energy in a deal worth more than $13 bn further leading to the consolidation of the US Energy and Power markets.

For more on this read at, http://www.ft.com/cms/s/0/5025c5c8-1b77-11e0-868c-00144feab49a.html?ftcamp=rss#axzz1AT0HQiUN

January 8, 2011

Sanofi, Genzyme Said to Make Progress in Takeover Talks at Higher Offer

Sanofi-Aventis SA and Genzyme Corp. are making progress in takeover talks and the French drugmaker is weighing a symbolic bump to its $18.5 billion offer, said two people with knowledge of the situation. Sanofi is open to raising its $69 a share offer by about $2 to get access to Genzyme’s books once the two sides agree on extra payments tied to certain drug targets, said the people, who declined to be identified because the talks are private. Those payments may be worth $5 to $6 a share, said this person. The exact value, along with specific milestones tied to sales and profits, are still being negotiated, the person said.

For more on this news related to the deal, read at http://www.bloomberg.com/news/2011-01-08/sanofi-genzyme-said-to-make-progress-in-takeover-talks-at-higher-offer.html

iGate-Patni deal likely to be inked on 10-01-11

IT services firm iGate could announce a deal for a controlling stake in Patni Computer Services, the country’s seventh-largest software exporter, on Monday. The deal is likely to be done at Rs 500-506 a share, two people with direct knowledge of the development said. The deal was earlier to be announced on Monday last, but a tax issue relating to Narendra Patni , one of the promoters who is based in the US, and pertaining to the proposed transaction, had delayed it. The issue was learnt to be clarified on Wednesday, paving the way for the deal to go ahead.

For more on this read at http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/heard-on-the-street/articleshow/7233427.cms

Skype acquires Qik mobile video company

Internet telephone service Skype said it acquired mobile video company Qik for an undisclosed amount. Qik's service -- available on more than 200 mobile phones, including Android and Apple's iPhone -- lets users capture and share video across smartphones and the Internet, Skype said in a news release. Skype, partly owned by Web retailer eBay Inc , is expecting to raise up to $1 billion in an initial public offering, sources familiar with the matter told Reuters in November. Skype said the transaction to buy Redwood City , California-based Qik, with 60 employees, should be completed this month.

January 7,2011

Inox open offer for Fame fails to attract investors

Multiplex chain Inox Leisure Ltd said on Friday it had acquired 1,075 shares in rival Fame India in its open offer. Inox had launched an open offer for 8.23 million shares of Fame, aggregating to 20.25 percent of the fully diluted share capital of the company, at 51 rupees a share. Fame has been embroiled in a takeover battle between Inox and rival Reliance MediaWorks since the beginning of 2010. Reliance MediaWorks had also made an open offer for 21.7 million shares, amounting to a 53.38 percent stake in Fame, at 83.4 rupees a piece. Media reports suggest Reliance MediaWorks has acquired 32 percent in the open offer that closed on Jan. 4.

IPO & FPO

January 27, 2011

3i acquires minority stake in BVG India

3i, an international investor in private equity, infrastructure and debt management , and funds managed by 3i, have acquired a minority stake in BVG India Limited. Financial details were not disclosed in the press statement released here.

BVG is one of India's largest facilities management services companies with a pan-India presence, offering a wide range of services. It was established in 1997 and has grown to over 18,000 employees.

The company provides services such as mechanised housekeeping, landscaping and gardening, logistics and transportation, electrical and mechanical services, among others.

For more on this, read at http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/3i-acquires-minority-stake-in-bvg-india/articleshow/7370641.cms

January 26, 2011

Nielsen Said to Raise About $1.6 Billion in U.S. IPO

Nielsen Holdings NV, the television ratings company owned by Blackstone Group LP, Carlyle Group, KKR & Co. and Thomas H. Lee Partners LP, raised about $1.6 billion in the first private equity-backed U.S. initial public offering of 2011, according to a person familiar with the sale.

Nielsen, which was taken private by six leveraged buyout firms in 2006, sold 71.4 million shares at $23 after offering them at $20 to $22 each, said the person, who asked not to be identified because the details were private.

LBO firms are betting the Standard & Poor’s 500 Index’s rally to a two-year high will increase demand for IPOs of debt- fueled acquisitions completed as credit markets started to freeze four years ago. Nielsen raised more than initially sought for a company that posted $1.4 billion of annual losses since the takeover and had $8.2 billion in net debt.

For more on this, read at http://www.businessweek.com/news/2011-01-25/nielsen-said-to-raise-about-1-6-billion-in-u-s-ipo.html

Glencore Said to Seek $2.5 Billion in Hong Kong IPO

Glencore International AG, the world’s largest commodities trader, plans to raise about $2 billion to $2.5 billion in Hong Kong as part of a $10 billion initial public offering in the Chinese city and London, according to two people familiar with the matter.

Glencore plans to sell shares in the cities in the second or third quarter this year, said the people, who declined to be identified because the information is confidential. Citigroup Inc., Credit Suisse Group AG and Morgan Stanley are among banks handling the IPO, the people said.

A share sale would mean the Baar, Switzerland-based company joins Vale SA, the world’s largest iron ore exporter, and United Co. Rusal, the biggest aluminum producer, in seeking access to Hong Kong investors after a record HK$384.4 billion ($49 billion) was raised in IPOs excluding overallotments there last year.

For more on this, read at http://www.businessweek.com/news/2011-01-25/glencore-said-to-seek-2-5-billion-in-hong-kong-ipo.html

January 24, 2011

ONGC FPO likely to hit the market on March 15, 2011

The Rs 13,000 crore public offering of state-run Oil and Natural Gas Corp (ONGC) is likely to hit the market on March 15, a government official said today.

"A tentative schedule has been drawn for the follow-on public offer, as per which the first road show will be held in Chennai on February 2 and the public offer will hit the market on March 15," the official said after the kick off meeting of the FPO here today.

ONGC will file the red herring prospectus for the FPO by February 25, by which time it hopes to have five more independent directors on the company's board to meet the SEBI's listing requirement.

The government plans to raise Rs 13,000 crore through sale of five per cent stake in ONGC.

Last week, the Government had appointed Bank of America Corp , Nomura Holdings , HSBC Holdings Plc , JM Financial Services, Citigroup Inc and Morgan Stanley to handle the FPO.

Post offer, the government shareholding in ONGC would come down to 69.14 per cent from the current 74.14 per cent.

For more on this, read at http://economictimes.indiatimes.com/markets/ipos/fpos/rights-issues/ongc-fpo-likely-to-hit-market-on-march-15/articleshow/7354613.cms

Groupon Not Fully Committed to IPO, CEO Mason Says

Groupon Inc., which last month rejected a $6 billion takeover offer from Google Inc., isn’t convinced it will sell shares in an initial public offering anytime soon, said Chief Executive Officer Andrew Mason.

The biggest daily deal website’s commitment to proceeding with an IPO this year is “less than 100 percent, that’s for sure,” Mason said in an interview at the Digital-Life-Design conference in Munich. “An IPO is something we are considering, but we’re just trying to learn more about the option at this point and understand the benefits and drawbacks.”

Groupon, based in Chicago, sells users discount vouchers for goods and services. It estimated this month that it will get $573.1 million of gross proceeds from an investment round, according to a regulatory filing. The company is also talking to Goldman Sachs Group Inc. and Morgan Stanley about an IPO, people familiar with the discussions have said.

Earlier in the month, Groupon completed a $950 million round of financing, a deal that valued the company at $4.75 billion, people familiar with the matter said. Groupon said it would use the funds to expand the business and buy back equity from existing shareholders.

For more on this, read at http://www.businessweek.com/news/2011-01-24/groupon-not-fully-committed-to-ipo-ceo-mason-says.html

Markets

Market Information

This table is updated at 12:00 am IST everyday. As such data for some of the markets may pertain to the previous day.

Stock Markets Spot Indices

Date	BSE Sensex	NSE Nifty	HangSeng	Nikkei	Nasdaq Composite Index	Dow Jones Industrial Average	FTSE	S&P500	Euro STOXX 50	Brazil Bovespa
07-01-2011	20163.80	6030.90	23845.80	10514.40	2709.89	11697.30	6019.51	1273.85	2855.29	70578.80
08-01-2011	19161.81	5904.60	23686.60	10541.00	2703.17	11674.80	5984.33	1271.50	2808.25	70057.20
10-01-2011	19224.12	5762.85	23527.30	10541.00	2691.14	11611.00	5970.10	1266.46	2769.43	69976.40
24-01-2011	19151.28	5743.25	23801.80	10345.10	2714.90	11954.40	5943.85	1289.12	2979.06	69372.40
25-01-2011	18969.4	5687.4	23788.80	10464.40	2709.82	11974.8	5917.71	1286.94	2957.78	69426.60
26-01-2011	18969.4	5687.4	23843.2	10401.90	2738.66	11998.7	5969.21	1297.30	2967.78	68772.8
27-01-2011	18684.4	5604.3	23779.6	10478.7	2756.47	11995.00	5965.08	1298.77	2989.75	67982.6
28-01-2011	18396.00	5512.15	23617.00	10360.3	2718.68	11929.2	5905.18	1289.41	2972.42	67000.10
01-02-2011	18022.2	5417.2	23482.9	10274.5	2734.84	11978.5	5965.05	1300.49	3003.77	67583.6
02-02-2011	18090.6	5432.00	23909.00	10457.40	2754.72	12038.6	5999.32	1305.09	3008.69	67407.4
03-02-2011	18449.3	5526.75	23909.00	10431.4	2745.77	12027.00	5983.34	1301.55	2995.49	66552.00
04-02-2011	18008.2	5595.75	23909.00	10543.5	2768.73	12071.90	5997.38	1308.81	3003.19	65717.50
07-02-2011	18037.2	5396.00	23553.60	10592.00	2792.5	12173.20	6051.03	1320.6	3031.18	65392.50
08-02-2011	17775.7	5312.55	23484.30	10.06360	2784.81	12196.60	6076.35	1321.67	3041.43	65771.1
09-02-2011	17592.8	5253.55	23164	10617.8	2782.87	12195.80	6052.29	1315.43	3031.62	64038.1
10-02-2011	17463.00	5225.8	22708.6	10605.7	2789.71	12221.7	6020.01	1320.79	3023.35	64939.1
11-02-2011	17728.6	5310	22828.9	10605.7	2809.4	12282.2	6062.9	1330.26	3024.37	65746.6
15-02-2011	18273.8	5481	22899.8	10746.7	2808.35	12223.9	6037.08	1328.21	3030.46	66773.10
16-02-2011	18300.9	5481.7	23157.0	10808.3	2823.92	12284.2	6085.27	1335.13	3061.92	67392.0
17-02-2011	18506.82	5548.45	23301.8	10836.6	2833.32	12304.9	6087.38	1339.43	3064.54	67556.4
22-02-2011	18438.31	5518.6	23485.4	10857.5	2833.95	12391.2	6014.8	1343.01	3012.34	67225.7
20-06-2011	17506.6	5257.9	21599.5	9354.32	2678.73	12080.8	5693.39	1278.13	2748.01	61264.5
21-06-2011	17560.3	5275.9	21850.6	9459.66	2680.97	12196.9	5775.31	1295.01	2801.99	61361.4
22-06-2011	17550.6	5278.3	21860.0	9629.43	2691.14	12200.0	5772.99	1297.29	2795.07	61718.1
23-06-2011	17727.5	5320.0	21759.1	9596.74	2665.95	11971.1	5674.38	1274.14	2730.86	61194.1
24-06-2011	18240.7	5471.25	22171.9	9678.71	2661.04	11977.7	5697.72	1273.32	2715.88	61066.7
04-07-2011	18814.5	5650.50	22770.5	9965.09	2816.03	12582.8	6026.63	1339.67	2870.09	63421.1
05-07-2011	18744.6	5632.10	22747.9	9972.46	2825.51	12579.9	6024.03	1339.15	2850.51	63410.2
07-07-2011	19078.3	5728.95	22530.2	10071.1	2874.32	12732.7	6054.55	1353.85	2844.51	62476.7
08-07-2011	18858.0	5660.65	22726.4	10137.7	2838.98	12598.9	5992.79	1337.17	2791.65	61481.7
18-07-2011	18507.0	5567.05	21804.8	9974.47	2757.06	12350.3	5752.81	1301.85	2622.36	58902.0
19-07-2011	18653.9	5613.55	21902.4	9889.72	2826.52	12587.4	5789.99	1326.73	2657.45	59080.3
20-07-2011	18502.4	5567.05	22003.7	10005.9	2821.9	12598.9	5753.82	1329.62	2705.75	59420.7
21-07-2011	18436.2	5541.6	21987.3	10010.4	2833.3	12708.4	5899.89	1341.85	2763.34	60176.2
22-07-2011	18722.3	5633.95	22444.8	10132.1	2845.47	12689.1	5935.02	1343.52	2772.6	60538.3
26-07-2011	18518.2	5574.85	22572.1	10097.7	2844.99	12530.7	5932.82	1334.75	2743.04	59312.5
27-07-2011	18432.2	5546.8	22541.7	10047.2	2791.27	12391.9	5856.58	1315.9	2693.71	58541.4
28-07-2011	18209.5	5487.75	22570.7	9901.35	2768.63	12254.0	5873.21	1301.65	2692.76	58586.4
29-07-2011	18197.2	5482.00	22440.2	9833.03	2766.14	12174.7	5815.19	1296.84	2670.37	58639.4
01-08-2011	18314.3	5516.8	22663.4	9965.01	2724.17	12029.4	5774.43	1277.83	2593.34	58393.6
02-08-2011	18109.9	5456.55	22421.5	9844.59	2669.24	11866.6	5718.39	1254.05	2544.89	57310.8
03-08-2011	17940.6	5404.8	21992.7	9637.14	2680.36	11847.5	5584.51	1253.81	2497.83	55839.0
04-08-2011	17693.2	5331.8	21884.7	9659.18	2616.78	11615.4	5410.11	1227.54	2427.71	53711.3
05-08-2011	17305.9	5211.25	20946.1	9299.88	2489.31	11272.9	5246.99	1177.39	2376.03	51476.7
08-08-2011	16990.2	5118.5	20490.6	9097.56	2445.34	11187.6	5092.91	1158.79	2305.71	50128.1
09-08-2011	16857.9	5072.85	19330.7	8944.48	2428.03	11005.2	5118.04	1145.83	2268.87	50533.3
10-08-2011	17130.5	5161.00	19783.7	9038.74	2402.42	10813.0	5007.53	1131.04	2157.43	50344.3
11-08-2011	17059.4	5138.30	19595.1	8981.94	2485.90	11121.1	5162.83	1170.70	2215.45	53395.0
26-08-2011	15848.8	4747.80	19582.9	8797.78	2455.06	11214.7	5123.96	1166.96	2186.74	53091.1
29-08-2011	16416.3	4919.6	19865.1	8851.35	2551.03	11517.6	5129.92	1206.42	2239.3	54966.0
30-08-2011	16676.8	5001.0	20204.2	8953.9	2574.6	11555.6	5260.74	1211.59	2238.21	55444.6
31-08-2011	16676.8	5001.0	20534.8	8955.2	2576.11	11560.0	5432.2	1212.92	2289.16	56067.5
01-09-2011	16676.8	5001.0	20585.3	9060.8	2580.45	11618.8	5389.38	1218.50	2288.71	58113.9
05-09-2011	16713.30	5017.2	19616.4	8784.46	2480.33	11240.3	5389.38	1173.97	2112.87	55049.8

Currency Exchange Rates

Date	USD-INR	USD-Euro	USD-Yen	USD-GBP	GBP-INR	Euro-INR
07-01-2011	45.33	0.769	83.3495	0.6471	70.3336	59.6665
08-01-2011	45.385	0.7747	83.1488	0.6432	70.57	58.6034
10-01-2011	45.385	0.7725	83.1488	0.6428	70.5641	58.5784
24-01-2011	45.62	0.7351	82.6955	0.6262	72.84	62.05
25-01-2011	45.7025	0.7329	82.3735	0.632	72.28	62.35
26-01-2011	45.489	0.7305	82.26	0.6294	72.26	62.26
27-01-2011	45.6847	0.7306	83.05	0.6287	72.65	62.523
28-01-2011	44.885	0.7339	82.258	0.6313	72.665	62.5035
01-02-2011	45.645	0.7253	81.47	0.6196	73.657	62.931
02-02-2011	45.5124	0.7252	81.66	0.6183	73.688	62.824
03-02-2011	45.667	0.7325	81.445	0.6193	73.76	62.3498
04-02-2011	45.575	0.736	82.322	0.6216	73.307	61.909
07-02-2011	45.39	0.738	82.446	0.621	73.09	61.5074
08-02-2011	45.193	0.7312	81.9108	0.6215	72.684	61.767
09-02-2011	45.455	0.7284	82.31	0.6209	73.174	62.4006
10-02-2011	45.64	0.734	83.109	0.6201	73.58	62.207
11-02-2011	45.615	0.738	83.49	0.624	73.103	61.797
15-02-2011	45.51	0.7402	83.806	0.6193	73.463	61.458
16-02-2011	45.405	0.7381	83.8173	0.6225	72.933	61.506
17-02-2011	45.215	0.7356	83.283	0.6184	73.113	61.475
22-02-2011	44.965	0.7309	83.1004	0.6165	72.93	61.5147
20-06-2011	44.9	0.69	80.29	0.61	72.76	64.23
21-06-2011	44.77	0.69	80.13	0.62	72.74	64.50
22-06-2011	44.75	0.69	80.26	0.62	72.12	64.46
23-06-2011	44.89	0.704	80.57	0.63	71.73	63.69
24-06-2011	44.93	0.705	80.37	0.63	71.83	63.76
04-07-2011	44.43	0.689	80.85	0.62	71.37	64.44
05-07-2011	44.36	0.6909	81.13	0.621	71.33	64.195
07-07-2011	44.32	0.6968	81.22	0.626	70.75	63.599
08-07-2011	44.29	0.7018	80.66	0.624	70.98	63.106
18-07-2011	44.60	0.7101	79.04	0.6234	71.53	62.806
19-07-2011	44.44	0.707	79.23	0.623	71.67	62.86
20-07-2011	44.39	0.703	78.75	0.618	71.75	63.164
21-07-2011	44.33	0.696	78.59	0.614	72.23	63.718
22-07-2011	44.34	0.697	78.42	0.613	72.32	63.66
26-07-2011	44.18	0.69	78.04	0.61	72.43	64.02
27-07-2011	44.14	0.697	78.13	0.619	72.13	63.34
28-07-2011	44.11	0.699	77.77	0.612	72.07	63.10
29-07-2011	44.08	0.695	77.07	0.608	72.49	63.45
01-08-2011	44.07	0.704	76.93	0.615	71.66	62.64
02-08-2011	44.34	0.704	77.09	0.614	72.26	62.941
03-08-2011	44.32	0.698	76.87	0.609	72.79	63.52
04-08-2011	44.55	0.705	79.01	0.613	72.72	63.19
05-08-2011	44.73	0.706	78.48	0.612	73.19	63.32
08-08-2011	45.00	0.704	77.60	0.612	73.47	63.96
09-08-2011	45.16	0.703	77.28	0.617	73.14	64.22
10-08-2011	45.25	0.705	76.41	0.618	73.15	64.23
11-08-2011	45.30	0.703	76.85	0.617	73.45	64.39
26-08-2011	46.15	0.692	76.61	0.612	75.36	66.78
29-08-2011	45.96	0.689	76.91	0.609	75.39	66.63
30-08-2011	46.02	0.692	76.75	0.614	74.95	66.43
31-08-2011	45.87	0.692	76.69	0.613	74.86	66.24
01-09-2011	45.73	0.700	76.83	0.618	74.00	65.30
05-09-2011	45.99	0.709	76.86	0.621	74.01	64.83

Bond Yields

Date	US 30yr	US 10yr
07-01-2011	4.52	3.40
08-01-2011	4.48	3.32
10-01-2011	4.47	3.29
24-01-2011	4.56	3.40
25-01-2011	4.52	3.37
26-01-2011	4.56	3.4
27-01-2011	4.58	3.4
28-01-2011	4.55	3.36
01-02-2011	4.61	3.44
02-02-2011	4.62	3.45
03-02-2011	4.62	3.51
04-02-2011	4.73	3.64
07-02-2011	4.73	3.67
08-02-2011	4.70	3.65
09-02-2011	4.69	3.63
10-02-2011	4.73	3.67
11-02-2011	4.71	3.65
15-02-2011	4.69	3.63
16-02-2011	4.69	3.64
17-02-2011	4.66	3.57
22-02-2011	4.68	3.58
20-06-2011	4.38	3.13
21-06-2011	4.38	3.13
22-06-2011	4.38	3.13
23-06-2011	4.38	3.13
24-06-2011	4.38	3.13
04-07-2011	4.38	3.13
05-07-2011	4.38	3.13
07-07-2011	4.38	3.13
08-07-2011	4.38	3.13
18-07-2011	4.38	3.13
19-07-2011	4.38	3.13
20-07-2011	4.38	3.13
21-07-2011	4.38	3.13
22-07-2011	4.38	3.13
26-07-2011	4.38	3.13
27-07-2011	4.375	3.125
28-07-2011	4.375	3.125
29-07-2011	4.375	3.125
01-08-2011	4.375	3.125
02-08-2011	4.375	3.125
03-08-2011	4.375	3.125
04-08-2011	4.375	3.125
05-08-2011	3.764	2.475
08-08-2011	3.73	2.4
09-08-2011	3.72	2.39
10-08-2011	3.51	2.11
11-08-2011	3.77	2.3
26-08-2011	3.54	2.19
29-08-2011	3.62	2.27
30-08-2011	3.54	2.20
31-08-2011	3.54	2.18
01-09-2011	3.53	2.16
05-09-2011	3.30	1.99

Commodities

Date	Brent Crude (USD/bbl)	Gold 100 oz Futures (USD /t. oz)	Silver (USD/t. oz)	Platinum (USD/t. oz)	Gold (INR/10 gm)
07-01-2011	93.93	1370.30	29.005	1726.00	19956.5
08-01-2011	93.33	1368.90	28.671	1731.00	19685.50
10-01-2011	95.68	1371.30	29.05	1741.00	19991.30
24-01-2011	96.48	1343.5	27.35	1822	20320
25-01-2011	95.3	1332.1	26.90	1787.00	20065.00
26-01-2011	97.29	1333.8	27.195	1791.00	20110.00
27-01-2011	97.95	1318.8	26.95	1807.00	19603.8
28-01-2011	98.62	1326.7	27.39	1795.00	20065.00
01-02-2011	101.28	1332.8	28.235	1817.00	20085.00
02-02-2011	102.21	1336.1	28.47	1835.00	20075.00
03-02-2011	102.29	1354.1	28.76	1828.00	20000.00
04-02-2011	100.5	1349.5	29.19	1838.00	20045.00
07-02-2011	99.77	1349.7	29.31	1849.00	20135.00
08-02-2011	100.26	1367.1	30.02	1854.00	20110.00
09-02-2011	102.02	1362.8	30.1	1858.00	20135.00
10-02-2011	101.5	1364.4	30.205	1834.00	20280.00
11-02-2011	101.1	1357.7	29.94	1829.00	20225.00
15-02-2011	101.33	1372.5	30.66	1842.00	20245.00
16-02-2011	103.68	1374.7	30.64	1828.00	20265.00
17-02-2011	103.62	1383.6	31.405	1834.00	20460.00
22-02-2011	107.18	1407	33.87	1847.00	20460.00
20-06-2011	111.56	1540.9	36.01	1727.00	22290.00
21-06-2011	110.93	1547.7	36.53	1748.00	22485.00
22-06-2011	113.59	1552.9	36.68	1750.00	22510.00
23-06-2011	107.62	1519.5	35.00	1710.00	22505.00
24-06-2011	104.82	1500.7	34.66	1690.00	22495.5
04-07-2011	111.41	1495.8	34.14	1716.00	21630.0
05-07-2011	114.2	1511.8	35.24	1740.00	21615.0
07-07-2011	118.32	1530.8	36.53	1736.00	21890.0
08-07-2011	117.48	1542.8	36.48	1745.00	22080.0
18-07-2011	116.06	1501.4	40.12	1776.00	22750.0
19-07-2011	117.18	1588.1	39.015	1776.0	23180.0
20-07-2011	118.14	1597.8	39.82	1767.0	23185.0
21-07-2011	118.66	1591.6	39.18	1788.0	23965.5
22-07-2011	118.52	1601.3	39.91	1794.0	23140.5
26-07-2011	118.24	1617.3	40.59	1794.0	23340.0
27-07-2011	118.05	1617.3	40.685	1819.0	23160.0
28-07-2011	117.24	1616.2	39.78	1792.0	23205.0
29-07-2011	116.78	1627.1	39.99	1785.0	23150.0
01-08-2011	116.05	1631.7	39.85	1800.0	23185.0
02-08-2011	116.05	1659.2	40.78	1799.0	23150.0
03-08-2011	113.88	1661.0	41.44	1787.0	23375.0
04-08-2011	110.81	1675.1	41.73	1755.0	23955.0
05-08-2011	107.65	1660.1	38.81	1715.0	24025.0
08-08-2011	105.77	1701.9	38.67	1718.0	24170.0
09-08-2011	104.29	1735	37.65	1739.0	24930.0
10-08-2011	104.14	1787.6	38.85	1757.0	25805.0
11-08-2011	107.66	1746.5	38.72	1785.0	25805.0
26-08-2011	110.68	1784.2	40.87	1820.0	25670.0
29-08-2011	111.88	1785.4	40.41	1836.0	26805.0
30-08-2011	114.05	1829.7	41.5	1850.0	26805.0
31-08-2011	114.28	1827.1	41.63	1850.0	26815.0
01-09-2011	115.11	1827.9	41.68	1853.0	26815.0
05-09-2011	110.78	1902.5	42.99	1873.0	27610.0

RBI Policy Reviews

January 25, 2011

Repo Rate increased from 6.25% to 6.50% Reverse Repo from 5.25% to 5.50% CRR maintained at 6.00%

• Third Quarter Review of Monetary Policy 2010-11:*
• http://www.rbi.org.in/scripts/NotificationUser.aspx?Id=6234&Mode=0*

January 24, 2011

Macroeconomic and Monetary Developments in the 3rd Quarter of 2011

1. Robust and broad-based growth is expected to coexist with elevated inflation in the near-term.

2. While the outlook for recovery in advanced economies has improved, concerns persist over the durability of the momentum.

3. Strong growth puts the economy back on its earlier high growth trajectory but sectoral imbalances pose risks to inflation.

4. Private consumption expenditure and gross capital formation emerge as the key growth drivers.

5. Higher current account deficit fully buffered by higher capital inflows, but sustainability concerns could stem from the composition of capital flows.

6. Large primary liquidity injected by the Reserve Bank to ease the liquidity pressures without diluting its anti-inflationary focus.

7. Deficit liquidity conditions helped in strengthening the transmission of policy rate actions to deposit and lending rates.

8. Upside risks to inflation from structural demand-supply imbalance in certain sectors and hardening global commodity prices have increased.

For details, read at http://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=23803

Others

Video Links

1. The Financial Crisis, the Recession, and the American Political Economy: A Systemic Perspective

This video can be accessed at http://mitworld.mit.edu/video/861

Articles

1. A return to deal making in 2010

This can be accessed at https://www.mckinseyquarterly.com/Corporate_Finance/Performance/A_return_to_deal_making_in_2010_2727?gp=1

2. A bunch of interesting articles from Knowledge@Wharton

This can be accessed at http://knowledge.wharton.upenn.edu/special_section.cfm?specialID=107

3. A Major Transformation': The Pros and Cons of the Dodd-Frank Act

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2574

4. The Dodd-Frank Financial Regulatory Law: Long-Awaited Cure -- or Cause for 'Wild-Eyed Alarm'?

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2570

5. The Global Economy in 2011: A Rocky Ride or Smoother Sailing Ahead?

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2666

6. Private Equity: Part of the Crisis or Part of the Solution?

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2507

7. Is China Private Equity's Next Rock Star?

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2510

8. The Goldman Sachs Facebook Deal: Is This Business as Usual?

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2680

9. The New BRICS on the Block: Which Emerging Markets Are Up and Coming?

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2679

10. Former Spanish Prime Minister Jose Maria Aznar on Bailouts, Protectionism and Why Europe Is a 'Declining Continent'

This can be accessed at http://knowledge.wharton.upenn.edu/article.cfm?articleid=2676

11. Outlook for US for Financial Year 2011

This can be accessed at http://www.cbo.gov/ftpdocs/120xx/doc12039/01-26_FY2011Outlook.pdf

12. Five myths about US interest rates

This can be accessed at https://www.mckinseyquarterly.com/Economic_Studies/Productivity_Performance/Five_myths_about_US_interest_rates_2737