Wholesale Price Index WPI It is the most widely used inflation indicator in India. Published by the Office of Economic Adviser, Ministry of Commerce and Industry . But what we generally find in headlines as inflation rate in India is Inflation rate based on WPI. In the last 50 years, WPI based inflation rate shows an average inflation rate around 7-8%. The highest inflation rate observed in India was 34.68 Percent in September of 1974. Inflation-linked bonds are tied to the cost of consumer goods by an index, such as the consumer price index (CPI). In the United States, Treasury Inflation-Protected Securities ( TIPS) and inflation-indexed savings bonds ( I-Bonds) are tied to the value of the U.S. CPI and sold by the U.S. Treasury. Current Affairs 2013 RBI auctions Inflation Indexed Bonds. These bonds will be linked to the inflation index of the country (Wholesale Price Index or WPI). RBI’s Core Banking Solution (e-Kuber) system used for both competitive and non-competitive bids for the auction are to be submitted in electronic format. The Government of India had issued such securities in the nineties, It has not issued zero coupon bonds after that. Capital Indexed Bonds – These are bonds, the principal of which is linked to an accepted index of inflation with a view to protecting the Principal amount of the investors from inflation.
Government of India in consultation with Reserve Bank of India (RBI) has decided to launch Inflation Index Bonds (IIBs), as instruments that will protect savings of poor and middle classes from inflation and incentivise household sector to save in financial instruments rather than buy gold. Wholesale Price Index WPI It is the most widely used inflation indicator in India. Published by the Office of Economic Adviser, Ministry of Commerce and Industry . In June 2013 when the Reserve Bank of India auctioned its first tranche of WPI-linked Inflation Indexed Bonds (IIBs), it received strong market response as it offered a 1.44 per cent annual return over and above the headline inflation (WPI), which then stood at 4.9 per cent.
22 Aug 2014 1997: Capital index Bond (CIB) had similar features. Budget 2013: announced inflation indexed bonds (IIB); RBI launches two type of IIB. IIB 27 Mar 2018 The government on Monday made a few announcement which cheered the struggling Indian sovereign bond market. Department of Economic Example 1 (For illustration purpose). Year. Period. Real Coupon. Inflation Index. Index Ratio. Inflation adjusted principal. Coupon Payments. Principal 18 May 2013 RBI to launch Inflation Indexed Bonds in June 2013. As stipulated in the Budget 2013-14, the government, in consultation with the RBI, has UPSC & IAS Study Material Government Securities & Treasury Bills (via RBI) & well-known companies with high credit ratings issues bonds; High credit ratings assure an investor of its Inflation Indexed Bonds – Primary Market Operations. 19 May 2004 The Reserve Bank of India (RBI) has revived the capital indexed bonds (CIBs) to offer investors a hedge against inflation. INFLATION INDEXED BONDS: The government launched certificates/ bonds to protect peoples' savings against price rise. These bonds called Inflation linked
In June 2013 when the Reserve Bank of India auctioned its first tranche of WPI-linked Inflation Indexed Bonds (IIBs), it received strong market response as it offered a 1.44 per cent annual return over and above the headline inflation (WPI), which then stood at 4.9 per cent. The Reserve Bank of India (RBI) extended the time for issuance of Inflation Indexed National Savings Securities Cumulative (IINSS-C) bonds (or inflation linked bonds) by three months to March 31, 2014, from December 31, 2013. The issuance can be closed earlier than March 31, 2014 with a prior notice. Inflation Rate= {(Price in year 2 – Price in year 1)/ Price in year 1} *100. Whole sale Price Index: WPI is used to monitor the cost of goods and services bought by producer and firms rather than final consumers. The WPI inflation captures price changes at the factory/wholesale level. The Reserve Bank of India held key policy rates in its policy review today to keep the delicate balance between inflation management and revival of growth. Rising commodity prices not a huge risk for inflation: R Sivakumar, Axis MF Inflation-Indexed Bonds or IIBs are are bonds where the principal is indexed to inflation. They are thus designed to cut out the inflation risk of an investment. These bonds will be linked to the inflation index of the country (Wholesale Price Index or WPI) and serve as a better investment How is Inflation Measured in India In India, inflation is measured on two price indices, viz, wholesale price index (WPI) and consumer price index (CPI). WPI measures price rise or inflation at the level of seller or retailer who buy commodities in bulk or ‘whole sale’.
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