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RBI: Monsoon still a concern though initial fears allayed

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New Delhi: While the monsoons so far have been able to diminish the fear of another year of drought, it still remains a concern for the country’s growth prospect as well as its inflation outlook, said the Reserve Bank of India (RBI) on Thursday. “While the progress of monsoon has allayed initial fears (of a drought), the uncertainty surrounding its progress and distribution remains a risk to the outlook for both growth and inflation”, the central bank said in its Annual Report for 2014-15. It suggested adopting inclusive and pre-emptive food management strategies in case a weak monsoon season hits this year. Taking into account initial conditions, including the prospects for the monsoon and for international crude prices, the RBI in April projected a baseline path for inflation in 2015-16 in which it would be pulled down from current levels by base effects till August but is expected to start rising thereafter to below 6.0 per cent by January 2016.

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“So far, inflation outcomes have closely tracked these projections. The risks to this trajectory are balanced as the weather-related uncertainties are offset by falling crude prices. Inflation developments will warrant close and continuous monitoring as part of the overall disinflation strategy that requires inflation to be brought down to 5 percent by January 2017,” the report said. According to the report, the outlook for growth is improving gradually with confidence in business remaining robust. The RBI said the government’s resolve on fiscal consolidation should propel efforts to reach the target for the gross fiscal deficit for 2015-16 at 3.9 percent. “Inflation developments will warrant close and continuous monitoring as part of the overall disinflation strategy that requires inflation to be brought down to 5 percent by January 2017. “Plans for disinvestment need to be front-loaded to take advantage of supportive market conditions, and also to forestall cutbacks in capital expenditure to meet deficit targets,” said the report. According to the RBI, the government’s resolve on fiscal consolidation should propel efforts to reach the target for the gross fiscal deficit for 2015-16 at 3.9 percent of GDP.

In the early months of the year, indirect tax collections have been robust and set to achieve budget estimates, though contingent upon a recovery in manufacturing and services. “Furthermore, plans for disinvestment need to be front-loaded to take advantage of supportive market conditions, and also to forestall cutbacks in capital expenditure to meet deficit targets. Such cut backs compromise the quality of fiscal consolidation. “States need to take advantage of the greater fiscal autonomy stemming from higher devolutions and prioritise capital and developmental expenditure so that the quality of sub-national fiscal correction is maintained,” the report said.

(IANS)

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Say Goodbye to Heavy EMIs – Opt for Flexi Hybrid Home Loan

With pre-approved offers from Bajaj Finserv on a gamut of loans including business loan, personal loan, etc., availing finance is easy and quick.

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Home Loan
Say Goodbye to Heavy EMIs - Opt for Flexi Hybrid Home Loan.
  • Flexi Hybrid Home Loan allows paying only interest as EMI
  • Principal holiday period of 4 years
  • The principal and interest after 4 years paid only on the amount utilised
  • Flexibility of flexi-interest and flexi term loan in a single loan

With the Reserve Bank of India (RBI) hiking repo rates in its bi-monthly monetary policy review by 25 bps, interest rates of several loans have already started tightening. Though aimed to control inflation, it’s anticipated that home loan borrowers will bear the brunt of the latest move by the apex bank.

Hike in repo rate would push up home loan interest rates and subsequently the EMIs. The move might be a dampener if you are a first-time home loan borrower. However, with Bajaj Finserv Flexi Hybrid Home Loan, not only do you get the requisite funds to buy your dream home but are also relieved of heavy EMIs. Read on to know more.

Home Loans
In this 21st century building a home is not everybody’s piece of cake but there is always a way for a will hence home loans provide you the way to own a house. Pixabay

Payment of only interest component as EMIs

A regular home loan, on a fixed interest rate, taken from a financial institution consists of the interest and the principal component. During the entire loan tenor, the EMI remains constant. Though the interest and the principal ratio varies during the loan tenor, the EMI remains fixed.

However, with Bajaj Finserv Flexi Hybrid Home Loan, during the initial tenor, you pay only the interest as the EMI and nothing for the principal. The principal holiday period, where you need not pay anything towards the principal, lasts up to 4 years. Only after 4 years, the EMI will constitute the principal and the interest component.

So, for instance, if the EMI of your home loan is Rs.30,000, with the interest component amounting to Rs.20,000, during the initial 4 years, you need to pay only Rs.20,000. Only after 4 years, you need to pay the principal component of the EMI. This not only reduces your EMIs but also help you better manage your finances. Also, during the interest-only period, there’s no reduction in the loan limit.

Principal and interest only on the amount utilised

Unlike a regular home loan where you need to pay interest on the entire loan amount disbursed, in case of Flexi Hybrid Home Loan, after the principal holiday period of 4 years for the balance tenor, the EMIs would consist of the principal and the interest – only on the amount utilised from your approved loan limit and not on the entire limit.

For instance, if your approved limit is Rs.25 lakh for a tenor of 15 years, and you use only Rs.20 lakh from this limit, after the principal holiday period, from fifth year onwards, you need to pay the principal and the interest only on Rs.20 lakh. This further brings down the EMI and helps in savings in the long-run.

High EMIs – No longer a hurdle

Thus, with a Bajaj Finserv Flexi Hybrid Loan, high EMIs are no longer a hurdle in purchasing your dream home. Irrespective of hike in home loan interest rate, following RBI’s move, this new and innovative home loan offering helps you buy your dream home with utmost ease.

Home Loan
You need to know we can get the loan for various purposes. Pixabay

Even if you are early into your career, where generally income levels are low, you can go on and address the crucial life goal of buying the home of your choice. The principal holiday period of 4 years not only keeps your EMIs low but also ensures you are able to take care of day-to-day expense of running a household. Apply for home loan today and enjoy the joys of owning your own home.

With pre-approved offers from Bajaj Finserv on a gamut of loans including business loan, personal loan, etc., availing finance is easy and quick. No long queues and lengthy paperwork. Just share a few basic details to know your pre-approved offer within seconds.