Showing posts with label Learn. Show all posts
Showing posts with label Learn. Show all posts

Saturday, September 6, 2008

CRR Rate in India

Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with RBI. If RBI decides to increase the percent of this, the available amount with the banks comes down. RBI is using this method (increase of CRR rate), to drain out the excessive money from the banks.

Whats Repo Rate?

We keep hearing about repo rate.
repo rate is the rate at which rbi discount securities like treasury bill to the bank. To meet certain liquidity standards ,from time to time, banks sell their securities like treasury bills to rbi at a discount price called reporate ,for a short period of time like overnight or fort night . after specified time banks repurchase the bill at its face value. so high repo rate high loss for banks or hike in reporate absorbe liquidity from the market by less lending to the banks, which in turn tame inflation.

Tuesday, September 2, 2008

FDI & FII

diff b/w fdi and fii
foriegn direct investment (for a sector good for india)
foriegn institutional investment (for 1 company max 10 % equit value )
For more do google.