RAGHURAM RAJAN TAKEN OVER THE MANTLE OF RBI

Raghuram Rajan took over as the new Governor of the Reserve Bank of India (RBI). Rajan, 50,  took charge from Duvvuri Subbarao. The duo shook hands warmly and hugged after Rajan signed papers taking over as the 23rd Governor of the central bank. is the second youngest Governor after CD Deshmukh. He worked as a professor of Economics at the University of Chicago's Booth School of Business. Rajan who moves to Mumbai after a year-long stint as the chief economic advisor in the Ministry of Finance,

"Ten minutes ago, I handed over charge to Raghuram Rajan," Subbarao said after stepping out of Mint Road. "The country could not have asked for a more capable person to lead the RBI in these most difficult times."  

Top bankers repose confidence

Top bankers today exuded confidence that Raghuram Govind Rajan, who today took over as the 23rd Governor of the Reserve Bank, has the intellectual prowess to wade through the present difficulties facing the economy and wished him all success for the stint at Mint Road. "Dr Rajan has too much of intellectual reputation and we wish him all the best," chairman of country's largest lender State Bank of India Pratip Chaudhuri told reporters. Chaudhuri was speaking after emerging from a luncheon hosted by senior-most deputy governor KC Chakrabarty at the RBI headquarters at Mint Road, which saw Duvuuri Subbarao demitting charge as Governor and Rajan taking over the reigns. Alluding to Rajan's impeccable record--he famously predicted the 2008 financial crisis--Kotak Mahindra Bank vice-chairman Uday Kotak said, "It is good to have a governor with this background to lead the country." Bank of Baroda chairman and managing director SS Mundhra said Rajan is experienced, qualified and competent to lead the economic thinking in the country during these trying times. It can be noted that Rajan assumes charge amidst extremely difficult pressures on the external front which are resulting in the rupee getting battered to become one of the worst hit currencies globally.

MF's hope corp bond market would deepen

Mutual Fund managers expect the Reserve Bank to have a fresh approach to the monetary policy under the new governor Raghuram Rajan and hope that corporate bond market would deepen under his leadership.
"We expect that the corporate bond market would be deepened under the new governor. During (the term of) Governor Subbarao, repo trade was introduced in the corporate bond market but the market is not deep. We hope that this will be deepened," Head of Fixed Income of Sundaram Mutual, Dwijendra Srivastava told PTI here.
He also said that as in the government securities market where trade is settled electronically, CP and CD market should have similar facility, to bring transparency . Fund managers expect the new governor to do a balancing act between growth and inflation.
"We hope that he will bring a different approach to the monetary policy and also do a balancing act between growth and inflation," Chief Executive of Association of Mutual Funds in India, H N Sinor said.
"Market appears to be cautious....If he is able to show growth, market will respond," Chief Executive Officer of LIC Nomura Mutual Fund Nilesh Sathe said.
Another fund manager from a large fund house said that the new governor should bring back growth as its top priority.
"Reserve Bank should create a yield curve which is rational. You can't have negative returns in the fixed income market and expect retail investors to come in," the fund manager said, wishing not to be named.
He also said the onus of deepening the corporate bond market lies with the Reserve Bank, which should create an enabling environment.