RBI likely to cut interest rate by 25 basis points on Aug 2:
On account of low levels of retail inflation and slow growth of the industrial sector, RBI is likely to cut the prime lending rates by 25 basis points to push credit growth in the economy. Moreover, such rate cut would not be promoted in case of CRR and SLR as there is adequate liquidity in the market. As a consequence of this rate cut, the growth in the factory output is supposed to boost up.
JD (U) join hands with NDA, CM Nitish Kumar attains victory with 131 MLA votes:
Nitish Kumar resigned from the office of Chief Minister of Bihar leading to a collapse of the “Mahagathbandhan” between JD (U) and RJD. The former CM took this step for the development of Bihar and to fight against the evil of corruption, when one of his own colleagues, Tejaswi Yadav, has been charged with having benami properties. Later that night, JD (U) joined hands with BJP and thereafter on 28th July, he won the confidence of 131 MLAs in the Bihar Assembly as against 108 votes.
Nawaz Sharif, after being removed from PM’s office, nominates his brother to be his successor:
On being proved the corruption allegations against Nawaz Sharif of PML-N in the Panama Paper case, the Pakistan Court, on being convinced about the forgery in the documents, passed a judgment removing Mr. Sharif from the office of PM. This judgment might turn into a political one and can further destabilize the economy of Pakistan. On his removal, the ousted PM nominated Shahid Khaqan Abbasi to serve as an interim Prime Minister until his brother Shahbaz Sharif contests by-election.
Tomomi Inada resigns from the post of Defence Minister of Japan:
Mrs. Inada, a close ally of Prime Minister Shinzo Abe, was supposed to be crowned as the Prime Minister of Japan. But, she resigned from the post of Defense Minister as cronyism overpowered public support. The main reason of this resignation is the lack of transparency over the South Sudan deployment and also because of the fact that she suggested that Military should back the ruling party. Such instances led to falling in the PM’s approval ratings below 30% in the recent polls.
Starbucks to take 100% stake of all its China outlets:
China is the fastest growing market for Starbucks, outside the USA and therefore it proposes to acquire full ownership of all its China outlets by paying a consideration of $1.3bn to its co-venturer. Mr, Kevin Johnson, CEO of Starbucks Corporation, feels that the China buyout is a part of the firm’s “long game” to deal with the moderate growth in the USA. As a result of this deal, Starbucks will acquire 100% ownership in 1300 stores in Shanghai and the provinces of Jiangsu and Zhejiang.
The U.K. FCA all set to phase out Libor by 2021:
The Libor interest rate benchmark is linked to a series of bank scandals, which was undiscovered until the financial crisis. Moreover, marketers need better benchmark rates which are based on observable transactions. FCA’s pledge to phase out Libor by 2021 is precious to any market participant who is ready to issue bonds against a newly established benchmark but would require some incentive to create such derivatives, which is not available at present.
Air France- KLM proposes to buy 31% stake in Virgin Atlantic:
As a result of the effectiveness of the deal, Sir Richard Branson, the founder of Virgin Group, would hold a minority stake as the share of Virgin Group would fall from 51% to 20%, while its US partner Delta will continue to hold 49% in the new company. This deal is supposed to be beneficial for the customers as they would have more alternatives to ply between Europe, UK and the USA via 12 hubs on both the sides of the Atlantic. Moreover, this deal was required as the weakening of Pound might lead to severe losses in 2017 for the Virgin Atlantic.
Amazon sales rise sharply, turning Jeff Bezos the richest man in the world:
Amazon’s sales rose in the second quarter, but profits plunged due to investment in new products and services and expanding the market overseas. Due to the ‘heads-down’ and ‘consumer focused’ strategies, Mr. Bezos was crowned as the richest man in the world. But, after few hours, the shares slid and Bill Gates reacquired the first position.
By Rajshree Kundalia
Image Source: Hindustan Times
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