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[ad_1] IMF urges Nepal to tighten monetary policy to bolster forex reserves [ad_2] Source link

[ad_1] What could be described as the beginning of the end of low-interest home loans, the RBI in an off-cycle monetary policy meet on Wednesday hiked the repo rate by 40 basis points to 4.40% with immediate effect. “This comes in the backdrop of retail inflation clocking a 17 month high of 6.95% in March 2022, which is significantly higher than the RBI’s outer tolerance level of 6.0%. Moreover, the withdrawal of accommodative policy clearly indicates cognisance of critical factors such as geo-political tensions in Eastern Europe and recent increase in crude oil prices. Leading banks have already increased housing loan rates in the past few months. With benchmark lending rates rising for the first time since August 2018, end user demand in the residential segment may get tapered to a certain extent,” said Anurag Mathur, CEO, Savills India. The impact of the off-cycle decision on all housing segments, especially affordable housing demand, needs to be closely monitored in the upcoming quarters. “On the supply side, steady rise in construction costs and the impact on financial stability of developers, unable to pass through the increase, could create a pressure on pricing,” added Mathur. Industry experts and developers, however, said the real estate sector was already expecting a hike in the rates to tackle the rising inflation. Vikas Wadhawan, Group CFO, Housing.com, PropTiger.com & Makaan.com, said, “The hike in the benchmark lending rate by 40 basis points is a laudable move in a bid to control inflation and strengthen the growth-oriented motives of the country. The real estate industry is well-positioned to manage any hike and was quite frankly expecting it as well to tackle the tight inflation. However, there will be a rise in the property prices coupled with the surging input costs, though the market sentiments, by far and large, will be stable.” Whatever may be the case, the hike in the repo rate is likely to impact both real estate and homebuyers sitting on the fence. Amit Modi, President, CREDAI (WUP), said, “As the inflation rate is at an all-time high along with the rising crude oil prices, the increase in the benchmark lending rate by 40 bps to 4.40 per cent will be another blow to the millions of home buyers, aggravated by the subsequent rise in home loan rates. The budgets of first-time homebuyers will be upset and their urge to buy homes will be impacted by it.” While the RBI has taken the decision to control the inflationary challenges, “the government also needs to take steps to contain the steep rise in the construction material costs besides other input costs and bring it down to economical rates to compensate the losses and afterwards, the benefits of such measures could be passed on to the end users or millions and millions of first-time buyers,” suggested Modi. Ankit Kansal, Founder and MD, 360 Realtors, said the industry has been mulling over an increase in rates for some time and is well placed to manage any hike. “Indian inflation is at an all-time high in the past 17 months and the RBI’s policy to increase lending rates and Cash Reserve Ratio is directed toward controlling the same. However, the silver lining is that even if we factor in the rise in input costs together with home loan rate growth, the aggregate increase in property prices will be in the safe range of 4-6% in FY 23. Given the fact that the job market is robust and most of the workforce would have witnessed a hike in salary/ appraisal (generally 10% or above), the overall impact of the rise in property prices will be squared off easily.” Some industry experts, however, believe this rate hike is short-term and going forward, housing sales will continue to grow. “Acquiring a home is seen as the biggest decision of one’s life and these short-term decisions are unlikely to have an impact on a buyer’s decision. Builders are still offering attractive schemes and in a few months, we will be amidst the festive season, which will bring back the buyers. The rate hike by RBI will impact the growth in residential sale, albeit in the short term. The low interest rate was one of the biggest reasons for the sale to breach the pre-Covid level. Recently, developers across the country also hiked the unit prices owing to continuous rise in the raw material cost. Home buyers also understand that these things are beyond the control of developers and they will continue to invest in real estate. Hopefully, once the global supply chain is restored, the rates will be cut again,” said Rajan Bandelkar, President, NAREDCO. The rate hike by the RBI also won’t have significant impact as home loan interest rates have already gone down substantially in the recent past. Lincoln Bennet Rodrigues, Chairman & Founder, The Bennet and Bernard Company, said, “The overall real estate sector now rests on a strong footing and buying decisions may not be altered by these marginal changes. The rate hike will not impact luxury home buyers much as end-users of this segment are at the top of the pyramid, unlike other housing categories, where they might defer purchase decisions. Going forward, we hope that the government continues to pay attention to the requirements of the sector, which is one of the largest employers in the country.” [ad_2] Source link

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[ad_1] EU proposes Russian oil ban to make Putin 'pay high price' for Ukraine [ad_2] Source link

[ad_1] RBI Governor LIVE: Reserve Bank of India governor Shaktikanta Das today said that the Monetary Policy Committee (MPC) met in an off-cycle meet and hiked interest rate by 40 basis points, taking repo rate to 4.40%. The decision comes at a time when the consumer price inflation (CPI) has been above the central bank’s upper threshold of 6 per cent for the last three months, amid the ongoing Russia-Ukraine war and US Federal Reserve monetary policy tightening. CPI inflation climbed to 6.95 per cent in March while WPI (wholesale price index) inflation touched 14.55 per cent in the same month. Economists and market experts have pointed out that the central bank needs to hike rates by 50 basis points in the upcoming June monetary policy meeting. Shaktikanta Das’ address comes just ahead of the US Federal Reserve policy meeting, where the Jerome Powell-led FOMC is expected to initiate the rate hike cycle.  [ad_2] Source link

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[ad_1] HSBC launches $1 billion planned share buyback [ad_2] Source link

[ad_1] Adani Enterprises said Wednesday its subsidiary Mumbai International Airport Ltd (MIAL) has raised $750 million senior secured private placement notes from global asset manager Apollo Global Management. The company said this is one of the largest private placements in India. MIAL, which runs India’s second largest airport Chhatrapati Shivaji Maharaj International Airport, said it has raised money through 7.25-year USD notes via Apollo-managed credit funds. The majority of the money raised through the capital raise will be used to refinance existing shorter maturity loans and new capital expenditure, the company said. Shares of Adani Enterprises were down over 1 per cent in early hours of trading. Brigitte Posch, Apollo Partner and Global Head of Emerging Market Debt, said the Mumbai International Airport is a critical infrastructure asset in India. “Amid significant market volatility, our ability to commit to the entire transaction and take a long-term view reflects some of the key strengths of Apollo’s global credit platform and perpetual capital base,” Posch added. MIAL plans to transform the Mumbai airport from a functional transit point into a vibrant, full-fledged business, hospitality and leisure ecosystem, the company’s chief executive Prakash Tulsiani said. “Combined with the Adani Portfolio’s proven speed of execution, the proceeds of this issuance will allow us to accelerate MIAL’s transformation and provide immense value to our stakeholders in the post-pandemic period and thereby improve the consumer experience,” Tulsiani added. The company said it will continue to diversify the sources of financing through access to different pools of capital. Allen and Overy and Cyril Amarchand Mangaldass acted as legal advisors to MIAL for the deal, while Linklaters and Talvar Thakore and Associates acted as legal advisors to Apollo. Chhatrapati Shivaji Maharaj International Airport, which is better called Mumbai Airport is world’s busiest single-runway airport and the second largest airport in the country. In March, the Adani Group concluded financing of its Navi Mumbai airport as the public sector lender State Bank of India underwrote the entire debt requirement of Rs 12,770 crore for the project. [ad_2] Source link

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[ad_1] N.Korea fires projectile towards sea off east coast, says S.Korea [ad_2] Source link