India’s banking system faced a cash crunch. The Reserve Bank of India added funds to ease the situation. This followed negative balance of payments and foreign investor outflows. The RBI sold dollars to bolster the rupee. Trade deficit widened, and deposit growth slowed. These factors contributed to the liquidity deficit. Borrowing costs for banks and companies increased.
Broad-based revival in rural demand improvement in incomes: Nabard Survey
A NABARD survey reveals a significant boost in rural economic momentum, with 80% of households reporting higher consumption over the past year. This rise in