Government expenditure is rebounding, leading to surplus liquidity in the banking sector as the Centre injects cash into the system. The Reserve Bank of India’s tolerance of this surplus suggests a potential shift toward softer monetary policy. Analysts note that government spending has been steadily increasing over the past few months, supporting economic growth.
Warsh’s gamble: A quieter Federal Reserve could mean volatile markets, higher rates
New Federal Reserve Chair Kevin Warsh is significantly reducing the central bank’s communication, particularly “forward guidance” on interest rates. This move, aimed at making markets