Mr. Rajiv Sabharwal, MD and CEO, Tata Capital on the RBI's Monetary Policy announcement today

- RBI chooses to pause rates and continues with the accommodative policy stance. The growth forecasts appear to be encouraging and the economic activity momentum will be further consolidated. RBI will monitor the impact of the Covid - 19 situation given the recent resurgence of cases across the country.

- The inflation projections will depend on food and fuel prints but overall the risks are well balanced. RBI's assurance of providing comfortable liquidity will help maintain efficient rate transmission & the corporate bond market will be buoyant

- The Central Bank's decision to extend the TLTRO facility for another 6 months is a step in the right direction. Further, the on-lending facility by NBFCs to Agriculture, MSME and Housing (classified as Priority Sector Lending) along with the liquidity support through NABARD, NHB & SIDBI will efficiently channelize credit to these productive sectors.

Source : Equity Bulls

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