Monetary Policy - Mr. Rajiv Sabharwal, MD and CEO, Tata Capital
(Time Zone: Arizona, USA)
- RBI continues to pause rates for the third consecutive policy. The inflation print seems higher than its comfort corridor which for now is an emerging situation. The complete restoration of supply chain in the near term will bring clarity on the inflation glidepath
- The credit off-take revival has so far been slow, but green spouts are visible in certain sectors which must be nurtured. RBI clearly acknowledges the need to further incentivize demand for a broad based activity pickup. RBI maintains its resolve to strengthen growth in the economy
- The comfortable systemic liquidity has been key to efficient rate transmission which is seen across the interest rate curve and has shown strong south bias. We may see a gradual unwind and calibrated tightening of excess systemic liquidity in the next quarter. At the same time the markets have been assured of optimum support with no undue liquidity shocks that could impact sentiments
- The announcements regarding dividend distribution, scale-based regulatory framework for NBFCs and strengthening of audit systems will bring in more transparency and efficiency to the financial sector.
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