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Time of India
a day ago
- Business
- Time of India
Life insurance industry's new business premiums up 13% in May 2025
The life insurance industry recorded nearly 13% year-on-year rise in new business premiums (NBP) in May 2025 to Rs 30,463 crore, up from Rs27,034 crore a year earlier, according to data released by the Life Insurance Council . The month saw a 10.4% fall in the number of life insurance policies sold by the companies as the industry continued to navigate the new surrender value guidelines that kicked in October last year. The growth was primarily driven by the private sector insurer, which reported a 16.6% increase in NBP to Rs12,058 crore. State-run Life Insurance Corporation ( LIC ) posted 10.3% increase to Rs18,405 crore, the data showed. Among listed private players, HDFC Life reported a 33% jump in premiums to Rs3,022 crore, while SBI Life 's total premiums grew over 25% to Rs2,950 crore. ICICI Prudential Life reported a near 7% growth to Rs1,407 crore. 'Typically, the first quarter is a weak season for the life insurance segment as it immediately comes after the fiscal end, where most retail customers rush to buy policies. In May, the YoY growth has come down compared to 15.1% in the same month a year ago mainly because of the impact of revised surrender value guidelines,' said Saurabh Bhalerao Associate Director – BFSI Research, CARE Ratings . In May, the overall industry growth was led by group business, whereas individual business reported a muted number. The growth was led by group single premium, which grew 13% YoY to Rs18,068 crore. The month also saw a fall in volume of policies sold. The fall in the individual non-single segment, which is the regular premium paid by retail customers, was at over 10% with LIC and private life insurers reporting a fall of 14% and 2%, respectively. However, despite the fall in volume in individual non-single premium segments, private insurers reported a premium growth, indicating that they have moved to higher value policies amid changes in surrender value regulations, Bhalerao said. The Life Insurance Council data shows that LIC's individual non-single premium income fell to Rs2,060 crore in May compared to 2,236 crore in the same month a year ago. Meanwhile, the premium income in the same segment for private life insurers stood at 5,025 crore compared to Rs4,681 crore a year ago. Economic Times WhatsApp channel )
Daily Maverick
23-04-2025
- Business
- Daily Maverick
After the Bell: Everybody is hedging with gold — should you?
Potential gold investors might have missed the big rise, but the bus is not too far down the road. If you run fast enough, you might still catch it. What's the opposite of trying to catch a falling knife? The phrase is often used when investors see the price of an equity falling, think it has to now be a bargain, only to experience the joy of it falling further. The opposite, I suppose, is chasing a rally; if you see an asset rising fast, when do you jump in? The experience can be the same, but the description is not as graphic. If you are trying to be cynical, you could say, well, I didn't chase the rally; I enthusiastically overpaid because I like the feeling of temporary euphoria followed by longer-term disappointment. Often, what happens if you try to chase a rally, is that you end up being slapped with a restraining order. But with gold now, the choice is really tough because, on the one hand, the chances that the seas will get less rough seem very distant. On the other hand, gold's price rise has been so dramatic, it's hard to avoid the feeling that much of the race has been run. The sheer dimensions of the rush into gold are so weird. The gold price is not just dramatically up; it's double its previous record high. It's not that gold hasn't risen faster or by as much in history. Gold is up about 29% over the past four months, which is about 6.25% per month. That's not as fast as 1979/80, when it rose 276% in 12 months, which is about 30% per month. The difference is that this time, the nominal price is a record, around $3,330 (R62,034) today, and the previous rallies in 1973 and 1979 were caused by huge surges in inflation. This time, the rally's speed is taking place in the context of much less extreme economic conditions. Interest rates have been more or less static for the past year, which means the rise is not being driven by rising interest rates, which typically suppress the gold price. Gold has risen faster and more in the past, particularly during 1979-1980 (276% in 12 months, 30% monthly) and 1973-1974 (200% in 24 months, 8.3% monthly) rallies, driven by extreme inflation and systemic shifts. The 2025 rally (25% in four months, 6.25% monthly) is rapid, but not the fastest and, while its magnitude is significant, it's dwarfed by earlier surges in percentage terms. However, the nominal price ($3,300+) is a record and, inflation-adjusted, it may have edged out the 1980s peak, a milestone not seen in 45 years. The current rally's speed and level are notable, given less extreme economic conditions, reflecting unique drivers like central bank diversification and geopolitical risks. Obviously, that means investors are not looking for an inflation hedge, but are responding to what are politely described as 'geopolitical risks'. That's econ-speak for the possibility that US President Donald Trump will do something else entirely bonkers. But even that is not a complete description, because the equity markets have typically bounced back, as they did yesterday, when Trump retracted his last bout of being a stable genius. Trump now claims that he has no plans to fire Federal Reserve chair Jerome Powell and that tariffs on Chinese goods would 'come down substantially'. That perked up the equity markets, and gold did lose some of its value. But if you just compare the rise in the gold price with the decline in stock prices, it's obvious gold is rising much, much faster than stock prices are falling. Ergo, there is more going on here than just political gyrations. There are other indicators too. The most obvious is that global central bank gold purchases are now becoming really substantial: they exceeded 1 000 tonnes in 2024, breaking the all-time record set just one year earlier. China, Türkiye and India led the charge. Gold-backed exchange-traded funds (ETFs) saw record inflows of $10-billion (R186-billion) in Q3 2024 and $21.1 billion (R393-billion) in Q1 2025, which to me suggests a much longer-term change in mentality. Essentially, investors around the world are now thinking they should have a little bit of gold in their portfolios just as a mitigator against volatility and much deeper geopolitical tensions than relatively trivial issues like the ongoing Trump circus. The third interesting thing is that investment in gold companies has now caught up with the gold price. Over the years, the gold price and the value of gold companies have tracked each other (sort of), as you might expect. But increases in the gold price often provide industrial leverage for gold companies opening up their margins. So you would expect the value of gold companies to run ahead of the price of the metal in the good times. That wasn't happening until recently, but now it's happening meaningfully. That means investors expect the gold price to stay higher for longer. The big winners, by the way, have been Gold Fields and AngloGold, the two ex-South African companies that have for years been the cheapest and therefore the most natural buying targets. I guess what I'm building up to is that potential gold investors might have missed the big rise, but the bus is not too far down the road. If you run fast enough, you might still catch it.
Express Tribune
20-03-2025
- Business
- Express Tribune
SBP reserves rise $49m
Listen to article The State Bank of Pakistan's (SBP) foreign exchange reserves increased $49 million to $11.15 billion during the week ended March 14, 2025. With this, the country's total liquid foreign currency reserves reached $16.02 billion, of which $4.87 billion was held by commercial banks. In its statement released on Thursday, the central bank cited no reason for the increase in reserves. Financial industry players hope that Pakistan's reserves will increase further following the potential release of a second loan tranche of over $1 billion by the International Monetary Fund (IMF). The approval of IMF's first review under the $7 billion Extended Fund Facility will also unlock additional external financing from other multilateral creditors. Meanwhile, gold prices in Pakistan surged further, mirroring the upward trend in international markets. In the local market, the price of gold per tola rose Rs1,800, reaching a new high of Rs320,800. Similarly, 10-gram gold was priced at Rs275,034, higher by Rs1,543, according to the All Pakistan Sarafa Gems and Jewellers Association (APSGJA). Thursday's rise follows an increase of Rs1,650 to Rs319,000 per tola a day ago. The international bullion rate also registered an uptick on Thursday, with prices climbing $12 to $3,050 per ounce (including a $20 premium), as reported by the APSGJA. Globally, gold prices eased after hitting a record high earlier in the session, but it had a bullish outlook driven by potential rate cuts signalled by the US Federal Reserve and ongoing geopolitical and economic uncertainties. Spot gold was down 0.4% at $3,036.13 an ounce due to profit-taking, after hitting a record high of $3,057.21. Trump, meanwhile, criticised the Fed's decision to hold rates, despite projections of two quarter-percentage-point cuts by year-end due to a weakening economic growth. Moreover, the Pakistani rupee remained mostly stable against the US dollar, recording a slight depreciation of 0.01% in the inter-bank market. By the end of trading, the rupee stood at 280.23, down just two paisa compared to the previous day's close at 280.21. The SBP conducted an open market operation through a reverse repo (injection) on Thursday. A total of around Rs888 billion was offered, which was fully accepted at a rate of 12.06% per annum for an eight-day tenor. The central bank received nine bids, all of which were accepted. This liquidity injection is aimed at stabilising market conditions and ensuring adequate cash flow within the financial system. Furthermore, the Central Directorate of National Savings (CDNS) revised upwards profit rates for various National Savings Schemes. The Short-Term Saving Certificate saw a 15-basis-point (bps) hike, with the return reaching 10.96% from 10.81%. For the Defence Saving Certificate, a marginal 1bps increase was made as it offered a return of 12.15%, up from 12.14%. Similarly, returns on the Pensioner Benefit Account, Behbood Savings Certificate and Shuhada Family Welfare Account were increased by 10 bps to 13.68% each. The Sarwa Islamic Term Account and the Sarwa Islamic Saving Account saw a more significant rise of 70 bps, with returns climbing from 9.74% to 10.44%. However, the Saving Account rate was reduced by 100 bps, from 11.5% to 10.5%.
Express Tribune
20-03-2025
- Business
- Express Tribune
Gold prices skyrocket as global, local markets hit new peaks
Listen to article Gold prices surged to historic highs in both international and local markets on Thursday, driven by sustained global demand, inflation concerns, and large-scale purchases by various governments. According to market reports, the persistent rise in gold prices is setting new records daily, with investors turning to the precious metal as a safe-haven asset. In the international bullion market, the price of gold per ounce increased by $12, reaching an all-time high of $3,050. The impact was immediately reflected in Pakistan's local markets, where the price of 24-carat gold per tola jumped by Rs1,800, reaching a record Rs320,800. Similarly, the price of 10 grams of 24-carat gold rose by Rs1,543, setting a new high at Rs275,034. Meanwhile, silver prices experienced a decline. The price of one tola of silver dropped by Rs31, settling at Rs3,524, while the rate for 10 grams fell by Rs26 to Rs3,021. Market analysts attribute the rising gold prices to ongoing economic instability and increasing global interest in gold as a hedge against inflation.
