Inflation worries

The latest data released by the National Statistical Office has shown that retail inflation has remained largely unchanged since the beginning of this year.

While food inflation has edged upwards, the core inflation, which excludes volatile food and fuel, has eased further. The effects of El Nino and the concomitant dip in production, especially in the TOP (tomato, onion, and potato), explain the surge in food inflation. Driven by subdued performance in manufacturing, industrial production has also taken a hit and slowed down to 3.8 per cent in January this year.

Under these circumstances, the MPC of the RBI has the task cut out to ensure the growth momentum of the economy. Given the uncertainty over food inflation, the MPC has less room to cut rates.

M Jeyaram

Sholavandan (TN)

Unclaimed deposits

This is with reference to the editorial “Orphan Accounts” (March 14). There should be regular correspondence by the banks with the customers so that the number of unclaimed deposits will reduce.

There should be a dedicated department in the banks to deal with unclaimed deposits.

Regular notices by banks to the legal heirs of unclaimed deposits will also help.

Finally, while opening accounts, the customers should be fully apprised about the advantages of opening joint accounts and nominations.

Veena Shenoy

Thane

The UDGAM portal would help the legal heirs or beneficiary to trace the deposits and also the entities to adhere to the regulatory guidelines.

While onboarding customers, banks must make them aware of informing them regarding relocation.

Banks like SBI already enabled transfer of home branches through the mobile application ‘YONO’ and internet banking. It is inevitable to have a common portal to record one’s financial assets including bank deposits, mutual funds, shares, insurance and also land records with nomination preferences.

Suitable mechanism may be provided so that the demise of depositors can be reported or traced down in definite intervals.

On confirmation the entities holding the assets can take steps within a reasonable time to transfer the assets to the legal heirs or as per nomination preferences in a hassle free manner.

Bejoy Francis

Thiruvananthapuram

Small cap sell off

The equity markets are abuzz with talks of mid-small caps ‘froth’ and ‘bubble’. Market experts are adding to the debate. Some recommend sticking to large-caps calling them quality stocks, implying that a small cap stock is not a quality stock. In the auto-component space, for example, most are mid-small caps.

Many companies here are among the best managed with impeccable governance, transparency, and good business prospects. Therefore equating small cap with poor quality may not be justified. Market experts must exercise caution.

V Vijaykumar

Pune

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