Monetary policy review: RBI expects ‘modest’ recovery in Jan-March

Six months into FY21, the (RBI) released its first estimate of economic growth in 2020-21 as its October monetary policy committee (MPC) meeting ended on Friday.

Accounting for the impact of the pandemic, real gross domestic product (GDP) in FY21 will fall 9.5 per cent, the MPC noted in its statement.

In that, the RBI gave quarterly estimates. After a 24 per cent fall in Q1, the central bank expects real GDP to fall 9.8 per cent in Q2, shed 5.6 per cent in Q3, and grow 0.5 per cent in Q4, with January-March marking the first quarter of a “modest” recovery.

As growth recovers, the MPC said inflation would moderate towards the range 4.5-5.4 per cent in the remainder of FY21.

It will further ease to 4.3 per cent in the first half of 2021-22, it noted, but with caution about “substantial” risks to the outlook if supply-side responses were not strong enough. The committee said growth was its priority this time, and the inflation surge was transient in nature.

“The MPC is of the view that revival in the economy from an

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IBM split won’t impact Indian operations, says CEO Arvind Krishna

As splits into two globally, separating the heritage IT infrastructure-managed services business from the futuristic hybrid cloud and AI piece, Arvind Krishna, Indian-born chief executive officer (CEO) of the technology major, has said the split will have “no material impact” on its Indian operations and structure while it unlocks enough potential in the country in both the spaces.

The separation, he said, would come into force in the second quarter of 2021, creating two globally as well as in India with different heads.

“We will have two entities in India but it will take a year to play out. I expect most people to find a place in one or the other (company),” said Krishna, who succeeded Ginni Rometty as CEO in January this year.

“We have not done the full employee split but close to 100 per cent of our clients get touched by our infrastructure-managed services employees. Maybe about one-third to one-fourth of our India employees will be part of the new company.”

Unlike many global technology companies, is uniquely positioned in India, which is not only a large market for

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White House To Propose $1.8 Trillion Stimulus, Trump Says Go Bigger

With the presidential election fast approaching, the White House is preparing a $1.8 trillion economic rescue plan to try to coax congressional Democrats into an agreement, according to media reports Friday.

President Donald Trump, who this week has veered wildly in his position on stimulus to help the world’s largest economy recover from the damage done by the Covid-19 pandemic, now seems to be making a major push to roll out funding before his November 3 bid for re-election.

The new proposal, an improvement over the administration’s previous $1.6 billion offer, brings them closer to the Democrats’ latest package costing $2.2 trillion.

But Trump, who is trailing in the polls against Democratic rival Joe Biden, said he wants an even more robust plan.

It’s unlikely that Congress will be able to pass a new stimulus package for the US economy before the November 3 election, Senate Majority Leader Mitch McConnell said
 AFP / Nicholas Kamm

“A lot of people are being hurt. I would like to see a bigger stimulus package frankly than either the Democrats or the Republicans are offering,” Trump said in an interview with conservative talk radio host Rush Limbaugh.

“I would like to see money going

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