RBI to carry out 'Operation Twist' to bring down rates. Government working to decriminalise provision of Companies Act. Anand Mahindra to step down as Chairman of Mahindra and Mahindra next year. Lenskart to raise $231mn from SoftBank Vision Fund II. Facebook is building its own operating system. German court bans Uber’s ride-hailing service. US House of Representatives approves US-Mexico-Canada trade deal.
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Imitation Is the Best Form of Flattery: In a first, the Reserve Bank of India (RBI) has announced a simultaneous sale and purchase of government bonds under the Open Market Operations mechanism.
The Central Bank said that it will purchase INR100bn of the 6.45%, 2029 bond and simultaneously sell an equal amount of debt maturing in 2020 via an auction on Monday.
The concept is similar to Operation Twist used by the Federal Reserve in 2011-2012 where it had swapped short-term treasury securities for longer-term government debt, which reduced the gap between two- and 10-year yields.
What is ‘Operation Twist’?: Its a concept where the Central Bank uses the proceeds from sale of short-term securities to buy long-term government debt papers, thereby leading to easing of interest rates on the long term papers. Moneycontrol
Speaking at an Assocham event today, PM Narendra Modi said that the government is working to decriminalise more provisions of Companies Act in a bid to further facilitate ease of doing business in the country.
He also urged the banking and the corporate sectors to take decisions freely and invest freely. Livemint
Staying Put: Fitch Ratings has affirmed India’s Long-Term Foreign-Currency Issuer Default Rating (IDR) ratings at 'BBB-' with a stable outlook.
The rating agency said that India’s growth outlook is still ‘solid’ as compared to peers, projecting India’s current financial year 2019-20 at 4.6%.
"We expect growth to gradually recover to 5.6% in FY21 and 6.5% in FY22 with support from easing monetary and fiscal policies and structural measures that may also support growth over the medium term," Fitch said in a statement. Financial Express
Meanwhile: Gita Gopinath, Chief Economist at the International Monetary Fund noted that India's economic growth, which has been contracting for last several quarters, is likely to remain muted in the December and March quarters of FY20.
Gopinath said GDP growth was expected to pick up in the last two quarters of FY20 but some high-frequency indicators show that a recovery is unlikely. ET Markets
End of an Era: Mahindra & Mahindra (M&M) Executive Chairman Anand Mahindra will step down from his position and become Non-Executive Chairman next year, effective 1 April, 2020, the company announced today.
The announcement comes following the new SEBI norms that mandated that the top 500 listed entities have to appoint a Non-Executive Chairperson on their boards by April 1, 2020, which would eventually lead to a split in the post of Chairman and Managing Director. Business Today
Delhi-based eyewear startup Lenskart is raising $231mn as part of its Series G funding round from SoftBank Vision Fund II Lightbulb. With this investment, the online eyewear retailer will be valued at $1.5bn. Inc42
ZuckAlone: Facebook has reportedly asked Mark Lucovsky, a co-author of Microsoft’s Windows NT, to build it a new operating system from scratch.
Facebook would benefit greatly from owning its own OS. Its Oculus hardware and its augmented reality glasses, for example, rely on Google’s Android OS. Moving to its own operating system would give Facebook more freedom, with not having to depend on rivals.
“We really want to make sure the next generation has space for us,” says Facebook’s VP of Hardware, Andrew ‘Boz’ Bosworth. “We don’t think we can trust the marketplace or competitors to ensure that’s the case. And so we’re gonna do it ourselves.” TechCrunch
Speaking of Facebook: Recently, a security researcher found a database of account info of 267mn Facebook users available in an unprotected format on hacker forums. More details here.
No Uber, No Cry: A court in Germany has ruled that Uber doesn't have the necessary license to operate a business that employs for-hire drivers. This effectively bars the ride-hailing giant from conducting business in the seven cities it operates in, in Germany.
The case was brought by a Germany taxi association and, if it doesn’t comply with the ruling, Uber could pay fines up to €250,000 per ride. Endgadget
A New Deal: The US-Mexico-Canada trade deal (USMCA) has been passed by the US House of Representatives in an overwhelming 385-41 vote. The pact now heads to the Senate, which is expected to ratify it early next year.
The USMCA replaces the erstwhile NAFTA, which President Donald Trump took the US out of soon after taking office. The new deal with the updated terms and conditions has received bipartisan support from both major parties - Republicans and Democrats.
It has already been ratified by the Mexican Senate. To go into effect, it needs to be ratified by both the US and Canada. CNBC
Plead Guilty: Goldman Sachs is in talks with the US government to admit guilt and pay a c. $2bn fine to resolve a criminal investigation into its role in the 1MDB corruption scandal. WSJ
ICYMI: The 1MDB scandal is a scandal surrounding the activities of a Malaysian government investment fund (1MDB), from which former Malaysian PM Najib Razak was accused of channelling over $700mn to his personal accounts. Goldman Sachs was the investment bank that advised 1MDB on bond sales and acquisitions, and has been accused of ignoring red flags while billions of dollars were looted from its client. (Click here to read more on the 1MDB scandal.)
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