Tag Archives: finance

British pound slumps to a 37-year low; Now 1 pound=1.14 US dollar or 91 INR

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Sep 16 (IANS) The British pound slumped to a 37-year low on Friday after new data showed that shoppers are pulling back spending as inflation squeezes household budgets, underscoring fears that the economy may already be shrinking, media reports said.

The currency fell below $1.14, its lowest since 1985, after the Office for National Statistics said that retail sales in August dropped 1.6 per cent month-over-month, the biggest decline since December 2021 and significantly worse than economists had expected, CNN reported.

“I think the UK is in recession already,” said Michael Hewson, chief market analyst at CMC Markets UK, CNN reported.

Pounds/IANS

Pounds/IANS

The pound has been hammered by a string of weak economic data, but also the steep ascent of the US dollar, a safe haven investment that sees inflows in times of uncertainty. The greenback is now near its strongest level in about two decades against a basket of top currencies, bolstered by expectations of another big rate hike by the Federal Reserve next week, the report said.

But the economic outlook in the United Kingdom means the pound is suffering more than most. It has lost more than 15 per cent of its value against the dollar this year, compared to a 12 per cent decline in the euro.

rupee-dollar/IANS

Rupee-dollar/IANS

A plan by Prime Minister Liz Truss to subsidise energy bills for households and businesses could ease the pain this winter, but may not be enough to restore growth. The Bank of England forecast a lingering recession before her plan was announced.

Investors have also been unsettled by indications that the government will pay for its energy program, which could cost as much as $171 billion, by sharply increasing the UK national debt.

Interest rates on small savings schemes remain unchanged

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The government-run small savings schemes remained to provide the same interest rates since the past two years though the bank fixed deposit rates have considerably increased the interest rate.

The small savings schemes’ interest rates were last revised in the first quarter of 2020-21, though banks have drastically hiked their home loan and term deposit rates after the Reserve Bank of India (RBI) raised its repo rate by 140 basis points since May 2022.

Small savings schemes like Public Provident Fund (PPF), National Savings Certificate (NSC), Post Office Savings Scheme and Sukanya Samriddhi Yojana are vital savings instruments for the common man, as they provide long-term benefits.

Here are the current interest rates of key small savings schemes:

* Public Provident Fund (PPF): 7.1 per cent

* National Savings Certificate (NSC): 6.8 per cent

* Post Office Monthly Income Scheme: 6.6 per cent

* Sukanya Samriddhi Yojana: 7.6 per cent

* Five-year Senior Citizens Saving Scheme: 7.4 per cent

* Kisan Vikas Patra: 6.9 per cent

 

The RBI had brought down its benchmark repo rate by 75 basis points to 4.40 per cent on March 27, 2020 — just three days after a nationwide lockdown was announced but the government had not reduced interest rates of small savings schemes, keeping in mind the interests of the pensioners.

RBI sources said the government will monitor inflation as well as the liquidity position before taking any decision to raise interest rates of small savings schemes. “Depending on how much inflation rises and whether there is tightening of liquidity position in future, the government may take a call on small savings schemes rates,” said a senior banking official told IANS.

On June 30, 2022, the Finance Ministry had notified that interest rates of small savings schemes have been kept unchanged for the July-September quarter of the current fiscal, effective from July 1.

“The rates of interest on various small saving schemes for the second quarter of the financial year 2022-23, starting July 1, and ending September 30, shall remain unchanged from those notified for the first quarter (April 1 to June 30) for FY 2022-23,” the Finance Ministry notification had said.

Indian Minister to Participate in Nairobi Conference on Devolution

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The Union Minister of State for Finance and Corporate Affairs, Mr. Arjun Ram Meghwal will represent the India in the 4th Annual Devolution Conference to be held from 6th to 9th March, 2017 at Nakuru County of Kenya.

He is expected to share the experience of devolution system and its progress in India and specifically highlight the 73rd-74th Constitutional Amendments and provisions their under for strengthening the local governance in India.

During his visit to Kenya, Mr. Meghwal will address the Devolution Conference and will brief the Conference on the revenue sharing between the Centre and the States as well as showcase the smooth devolution on the recommendations of 14th Finance Commission from the earlier 32% share in 13thFinance Commission to 42% of Union’s net tax receipts, to the States, said a statement.

To share the successful experience of the Urban and Rural Local Bodies, Mr. Meghwal will inaugurate the Conference with the objective of sharing of good experience of devolution system and through the platform of Devolution Conference and how it can be used to increase Good Governance and Public Accountability for the Social and Economic Development internationally.

About 10,000 delegates are expected to participate from different regions including African Nations and China in the conference, including Members of Parliament, Leaders of Opposition from several States, professionals, representatives of various civil societies, religious and social organizations from Kenya among others.