Top Financial News: RBI’s Moves and Market Recovery Highlight Today’s Developments
By NDTV Profit Desk
March 5, 2025, 08:00 PM IST
Today’s financial landscape has been marked by significant outcomes, with Indian markets ending a streak of losses, the Reserve Bank of India’s announcements regarding liquidity measures, and international economic highlights, particularly from China.
RBI’s Liquidity Expansion
The Reserve Bank of India (RBI) confirmed on Monday that it will enhance liquidity in the banking system through open market operations (OMOs) and long-tenure dollar-rupee buy/sell swaps. The central bank will purchase government securities amounting to ₹1 lakh crore, divided into two tranches of ₹50,000 crore each. The first auction is scheduled for March 12, while the subsequent auction will occur by March 18. Additionally, the RBI will conduct a dollar-rupee buy/sell swap worth $10 billion, expected to take place on March 24. This measure follows a similar swap that received strong bids earlier this week, reflecting the pressing need for liquidity amid ongoing financial challenges.
Concerns Over Non-Bank Lending
In another critical development, the RBI has raised its concerns regarding non-bank financial institutions that provide perpetual credit lines. This lending structure permits borrowers to access credit indefinitely without predetermined repayment schedules, raising the risk of "evergreening," where new credit is used to settle existing debts. The RBI’s alert signals regulatory caution as it seeks to safeguard the financial ecosystem.
Market Recovery: Nifty Ends Losing Streak
The Indian equity markets saw a resurgence today, with the Nifty 50 index rising by 1.15% to close at 22,337 points, marking an end to a ten-day losing streak—the longest such downturn in 29 years. Similarly, the BSE Sensex gained 1.01%, closing at 73,730 points. This rebound was broad-based, with all sectoral indices reflecting positive momentum, particularly in the metal and media sectors.
International Focus: China Sets Growth Target
On the global stage, China has reaffirmed its economic resilience by setting its GDP growth target at approximately 5% for 2025. This target has remained unchanged for three consecutive years, underscoring the nation’s commitment to stability amid ongoing trade tensions with the United States. In conjunction with this target, the Chinese government has also announced a fiscal deficit goal set at around 4% of GDP, which is the highest in over 30 years.
Other Notable Financial Developments
Several other noteworthy developments have emerged today:
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Cost-Cutting Measures by Ola Electric: The electric vehicle maker is implementing operational reforms to reduce costs in response to softening sales expectations.
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Tax Savings for High Earners: Individuals with high incomes are increasingly leveraging Section 80GGC of the Income Tax Act to deduct contributions made to political parties, attracting intermediary services to facilitate these financial maneuvers.
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Potential Air Conditioner Shortages: As summer demand approaches, there is concern over potential shortages of air conditioning units due to delays in component shipments impacting major manufacturers like Voltas and Blue Star.
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Proposed Tax Bill Expands Digital Oversight: The draft Income Tax Bill, expected to go into effect on April 1, 2026, would allow tax authorities access to private digital communications if they suspect unreported income.
Conclusion
Today’s developments in the financial sector reflect a complex interplay of domestic policy adjustments and global economic conditions. Stakeholders are advised to stay informed as these narratives evolve, decidedly affecting investment landscapes and regulatory frameworks in India.
For continuous updates and insights, stay tuned to NDTV Profit as we navigate these crucial economic shifts.
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