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Business Standard
16 hours ago
- Business
- Business Standard
'We've won the inflation battle': RBI Guv Sanjay Malhotra on rate cuts
The Reserve Bank of India on Friday expressed confidence in having brought inflation under control, shifting its focus toward sustaining economic growth. Speaking after the Monetary Policy Committee (MPC) meeting, RBI Governor Sanjay Malhotra said the central bank had effectively curbed price pressures. 'We have won the inflation battle,' he declared. Retail inflation, as measured by the Consumer Price Index (CPI), eased to 3.16 per cent in April, the lowest since July 2019, and remained below the RBI's 4 per cent target for the third consecutive month. A sharp fall in food inflation, down to 1.78 per cent from 8.7 per cent a year earlier, played a key role in this easing trend. Meanwhile, Wholesale Price Index (WPI) inflation fell to 0.85 per cent in April from 2.05 per cent in March, driven largely by a decline in fuel and power prices. Our choice was to give certainty to markets: RBI guv Explaining the timing of the policy moves, Malhotra said, 'Our choice was to keep the stance accommodative but not act, or to act and change the stance to neutral. We chose to act. Actions are as important as intent.' He said, 'Whatever we do, we do decisively and at the right time. The more certainty we give to markets and banks, the stronger our macros will be.' The RBI reduced the repo rate to 5.5 per cent, and lowered the Cash Reserve Ratio (CRR) to 3 per cent from 4 per cent, to be implemented in four tranches starting in September. The RBI governor said the CRR move alone would inject about ₹2.5 lakh crore into the system by November-end. 'We could have announced the CRR cut later,' he said, 'but we did it today to assure banks that liquidity will be maintained. It gives them room to plan credit and reduce rates.' CRR comfortable for liquidity management Explaining the rationale behind the CRR cut, Malhotra said, 'Over the last 12–13 years, CRR has mostly remained at 4 per cent. During Covid, we reduced it by 1 per cent. Based on current experience, 3 per cent is a comfortable reserve ratio from a liquidity management perspective.' He estimated the cut could improve bank Net Interest Margins (NIMs) by at least seven basis points. Neutral stance means data-dependent decisions On the shift from an accommodative to a neutral stance, Malhotra clarified, 'Neutral means we are open to either direction; it all depends on incoming data. The statute doesn't mandate a vote on stance, but all six MPC members were in agreement to shift to neutral.' He said the MPC has 'limited scope to boost growth', which made the change in stance necessary. 'If the data demands that we stay put, we will. But if it points to further action, we will not hesitate,' he said. Lending norms eased for small loans, gold loans In an effort to improve credit access, especially for small borrowers, the RBI announced the following: LTV cap for small loans (up to ₹2.5 lakh) has been raised to 85 per cent from 75 per cent, including interest. Final guidelines for gold loans will be released by Monday. Credit appraisal will no longer be required for small-ticket gold loans. End-use monitoring will apply only to loans under Priority Sector Lending. These changes are likely to ease access to funds for low-income borrowers, particularly in rural India where gold loans are a primary source of credit. Liquidity abundant; no target call rate On liquidity management, Malhotra reiterated: 'Liquidity is abundant. We have not set any target call rate. We'll watch how the situation evolves, but right now, there's no concern.'
The Age
2 days ago
- Business
- The Age
Workers compensation legislation to face second inquiry after government loses first battle
The NSW Labor government's contentious workers compensation bill has been dealt a major blow and will be delayed indefinitely after Treasurer Daniel Mookhey failed to convince the Coalition and crossbenchers to back his reforms. To avoid an embarrassing loss in the upper house, the government did not oppose the Coalition's push to have a second inquiry into the bill, which will occur over at least two weeks and have broad powers to interrogate the data and modelling underpinning the proposed legislation. The proposed changes included increasing the Whole of Person Impairment (WPI) threshold to 31 per cent, limiting the capacity for people with serious psychological injury to receive long-term support or claim damages. Mookhey had warned the Coalition's amendments to the legislation would cost the state $1.9 billion. This will be the second time the legislation is considered by an inquiry, after a snap one-day hearing was held in mid-May. Some Labor backbenchers had circulated a draft letter imploring the premier to delay the introduction of the bill. Loading Opposition treasury spokesman Damien Tudehope acknowledged he and Mookhey seemed to 'have swapped friends' as he argued an inquiry was fundamental to understand the inherent risks with the reforms, a process he believed should have begun in October last year. Mookhey, who hoped the legislation would be debated and passed on Thursday, argued an inquiry would miss an opportunity to begin repairing the state's workers compensation system, providing certainty to injured workers and small businesses ahead of three successive years of 12 per cent cost rises in premiums. 'I understand as well the point that the shadow treasurer is making about the desire to familiarise himself further with data, but that comes at an expense, that is the opportunity cost we have to fix this system,' he said. 'I urge the house to do its job today.'
Sydney Morning Herald
2 days ago
- Business
- Sydney Morning Herald
Workers compensation legislation to face second inquiry after government loses first battle
The NSW Labor government's contentious workers compensation bill has been dealt a major blow and will be delayed indefinitely after Treasurer Daniel Mookhey failed to convince the Coalition and crossbenchers to back his reforms. To avoid an embarrassing loss in the upper house, the government did not oppose the Coalition's push to have a second inquiry into the bill, which will occur over at least two weeks and have broad powers to interrogate the data and modelling underpinning the proposed legislation. The proposed changes included increasing the Whole of Person Impairment (WPI) threshold to 31 per cent, limiting the capacity for people with serious psychological injury to receive long-term support or claim damages. Mookhey had warned the Coalition's amendments to the legislation would cost the state $1.9 billion. This will be the second time the legislation is considered by an inquiry, after a snap one-day hearing was held in mid-May. Some Labor backbenchers had circulated a draft letter imploring the premier to delay the introduction of the bill. Loading Opposition treasury spokesman Damien Tudehope acknowledged he and Mookhey seemed to 'have swapped friends' as he argued an inquiry was fundamental to understand the inherent risks with the reforms, a process he believed should have begun in October last year. Mookhey, who hoped the legislation would be debated and passed on Thursday, argued an inquiry would miss an opportunity to begin repairing the state's workers compensation system, providing certainty to injured workers and small businesses ahead of three successive years of 12 per cent cost rises in premiums. 'I understand as well the point that the shadow treasurer is making about the desire to familiarise himself further with data, but that comes at an expense, that is the opportunity cost we have to fix this system,' he said. 'I urge the house to do its job today.'
West Australian
2 days ago
- Business
- West Australian
NSW Labor workers comp reform to be referred to inquiry despite pleas for urgency
Labor's controversial plan to reform workers compensation in NSW has suffered another blow after being referred to an inquiry, despite a plea by the Treasurer that it be urgently passed. The NSW government is attempting to pass amended plans to reform workers compensation before July 1, having faced significant opposition from the unions and the Opposition. Liberal leader Mark Speakman said the Coalition was in favour of reform to the beleaguered system, but only with key amendments – if not, they will seek to send it to an inquiry. The Opposition, in a bizarre alliance with the Greens and the unions, is seeking to stay plans to lift the threshold for a permanent whole person impairment (WPI) to 31 per cent. Opponents of the planned changes say they would lock most claimants suffering a psychological injury out of support; the government says it offers greater access to lump sum payments. Appearing before the Legislative Council, shadow treasury spokesperson Damien Tudehop moved that the bill be referred to the Public Accountability and Works Committee for inquiry in August. Instead, an amended version of the motion put forward by independent MLC Mark Latham was approved by the Council, which set that the committee would determine its own reporting date. 'It is incumbent upon the Treasurer to at least demonstrate … the manner in which this scheme is currently operating and why the savings, which have been identified for the scheme, are acting or potentially acting to target people who are the most vulnerable in terms of psychological injury which they have suffered,' Mr Tudehop said. Mr Tudehope went on to add: 'There are other areas of the manner in which the scheme is being managed at the moment, which can produce savings. There are significant savings identified in the act, which in fact we will be wholeheartedly endorsing'. During his address, Mr Tudehope said he was 'not here to hold up the process', but that the Opposition had not had enough time to properly assess the plan. In response, Treasurer Daniel Moohley said delaying the bill by referring it to an inquiry would be an 'opportunity that we miss' to begin repairing the 'broken' system. 'The opportunity we will miss is to begin to provide for injured workers,' he said. 'Absent reform, a small business that has no claims rejected is facing the prospect of a 12 per cent increase next year, followed by a further 12 per cent, followed by a further 12 per cent. 'The bigger opportunity that we've been missing is to begin to build a proper culture of prevention when it comes to psychological injury. 'That is crucial to stopping people from getting injured in the first place and at the same time making sure that we have a workers compensation system that complements the task of returning people to their health and returning people to their work.' In four weeks time, Mr Moohkey warned the system would 'fall back even further' and make reform harder, including the private sector which he said was suffering $5m losses per day. He instead urged for the Opposition to 'make this decision today' and put their amendments up for debate, rather than referring the workers compensation bill to an inquiry. Greens MLC Abigail Boyd supported the Opposition's motion, stating that the bill, if passed, 'could cause so much distress to people who are already at their most vulnerable that they may choose to end their lives. 'A bill that is literally about life and death. 'That's why we should never seek to pass a bill like this in these circumstances, with the secrecy, the deception, the blatant mistruths that we've been told over the last three months, and with the government having failed to make out the case for what they have decided to do.' She urged Labor MLCs supporting the bill to consider whether it was 'this reform that has been never recommended in any of the multiple, multiple reports or inquiries into the workers compensation system, that has been sprung on you with very little warning. 'Are you personally satisfied that the only option, the only option is to implement these reforms? The most cruel and dangerous of all of the possibilities.' She went on to add: 'I don't think any Labour member can honestly say that they thought two years ago they would now be sitting here trying to defend a bill that will kill workers.' The proposed workers compensation reform has faced stiff opposition from the state's unions, as well as a parliamentary inquiry, and competing claims about urgency. The state government says the reforms need to be passed before July 1, while the Opposition says premiums for the nominal insurer are already locked for next year. Mr Moohkey previously indicated he would not authorise further payments to the Treasury Managed Fund, the government's self-insurer, following billions in cash injections. The plan also seeks to address the state of the nominal insurer, the health of which has resulted in rising premiums for businesses and charities operating in the state, Mr Moohkey said failure of the bill had already been factored into the state budget,
Perth Now
2 days ago
- Business
- Perth Now
Major blow to Labor's compo reform
Labor's controversial plan to reform workers compensation in NSW has suffered another blow after being referred to an inquiry, despite a plea by the Treasurer that it be urgently passed. The NSW government is attempting to pass amended plans to reform workers compensation before July 1, having faced significant opposition from the unions and the Opposition. Liberal leader Mark Speakman said the Coalition was in favour of reform to the beleaguered system, but only with key amendments – if not, they will seek to send it to an inquiry. The Opposition, in a bizarre alliance with the Greens and the unions, is seeking to stay plans to lift the threshold for a permanent whole person impairment (WPI) to 31 per cent. Opponents of the planned changes say they would lock most claimants suffering a psychological injury out of support; the government says it offers greater access to lump sum payments. Appearing before the Legislative Council, shadow treasury spokesperson Damien Tudehop moved that the bill be referred to the Public Accountability and Works Committee for inquiry in August. Instead, an amended version of the motion put forward by independent MLC Mark Latham was approved by the Council, which set that the committee would determine its own reporting date. NSW Treasurer Daniel Mookhey addresses the media in a press conference to provide an update on the Governmentí•s workers compensation reforms. Photo: NewsWire/ Gaye Gerard Credit: News Corp Australia 'It is incumbent upon the Treasurer to at least demonstrate … the manner in which this scheme is currently operating and why the savings, which have been identified for the scheme, are acting or potentially acting to target people who are the most vulnerable in terms of psychological injury which they have suffered,' Mr Tudehop said. Mr Tudehope went on to add: 'There are other areas of the manner in which the scheme is being managed at the moment, which can produce savings. There are significant savings identified in the act, which in fact we will be wholeheartedly endorsing'. During his address, Mr Tudehope said he was 'not here to hold up the process', but that the Opposition had not had enough time to properly assess the plan. In response, Treasurer Daniel Moohley said delaying the bill by referring it to an inquiry would be an 'opportunity that we miss' to begin repairing the 'broken' system. 'The opportunity we will miss is to begin to provide for injured workers,' he said. 'Absent reform, a small business that has no claims rejected is facing the prospect of a 12 per cent increase next year, followed by a further 12 per cent, followed by a further 12 per cent. 'The bigger opportunity that we've been missing is to begin to build a proper culture of prevention when it comes to psychological injury. 'That is crucial to stopping people from getting injured in the first place and at the same time making sure that we have a workers compensation system that complements the task of returning people to their health and returning people to their work.' In four weeks time, Mr Moohkey warned the system would 'fall back even further' and make reform harder, including the private sector which he said was suffering $5m losses per day. Shadow Treasurer Damien Tudehope moved the bill be referred to an inquiry. NewsWire/ Gaye Gerard Credit: News Corp Australia He instead urged for the Opposition to 'make this decision today' and put their amendments up for debate, rather than referring the workers compensation bill to an inquiry. Greens MLC Abigail Boyd supported the Opposition's motion, stating that the bill, if passed, 'could cause so much distress to people who are already at their most vulnerable that they may choose to end their lives. 'A bill that is literally about life and death. 'That's why we should never seek to pass a bill like this in these circumstances, with the secrecy, the deception, the blatant mistruths that we've been told over the last three months, and with the government having failed to make out the case for what they have decided to do.' She urged Labor MLCs supporting the bill to consider whether it was 'this reform that has been never recommended in any of the multiple, multiple reports or inquiries into the workers compensation system, that has been sprung on you with very little warning. 'Are you personally satisfied that the only option, the only option is to implement these reforms? The most cruel and dangerous of all of the possibilities.' She went on to add: 'I don't think any Labour member can honestly say that they thought two years ago they would now be sitting here trying to defend a bill that will kill workers.' The proposed workers compensation reform has faced stiff opposition from the state's unions, as well as a parliamentary inquiry, and competing claims about urgency. The state government says the reforms need to be passed before July 1, while the Opposition says premiums for the nominal insurer are already locked for next year. Mr Moohkey previously indicated he would not authorise further payments to the Treasury Managed Fund, the government's self-insurer, following billions in cash injections. The plan also seeks to address the state of the nominal insurer, the health of which has resulted in rising premiums for businesses and charities operating in the state, Mr Moohkey said failure of the bill had already been factored into the state budget,
