RBI Monetary Policy Review: Who said what
Here are the experts' comments on RBI Monetary Policy Review.
New Delhi: The Reserve Bank on Wednesday slashed benchmark lending rate by 0.25 percent to 6 percent citing reduction in upside risk to inflation, a move that will lower EMIs for home, auto and personal loans.
This is the first rate cut since October 2016 and the interest rate is now at 6-year low.
In line with record low retail inflation, the RBI Governor headed Monetary Policy Committee (MPC) cut policy repo rate by 25 basis points to 6 percent and the reverse repo by similar proportion to 5.75 percent.
The MPC has also decided to keep the policy stance neutral and to watch incoming data with a view to keeping headline inflation close to 4 percent.
Here are the experts' comments on RBI Monetary Policy Review
NITI AAYOG MEMBER BIBEK DEBROY
"Should the RBI cut rates? I think the answer is yes. Will it matter significantly? I don`t think it will matter significantly except to serve as a signal".
SUBHASH CHANDRA GARG, ECONOMIC AFFAIRS SECRETARY IN THE FINANCE MINISTRY
The Reserve Bank of India`s decision to cut interest rates on Wednesday was an "important" step for ensuring sustained economic growth.
Secretary,DEA, Shri S.C. Garg: Govt welcomes 25 basis points cut in the repo rate announced today by the MPC in its 3rd Bi-Monthly Meeting. — Ministry of Finance (@FinMinIndia) August 2, 2017
CHANDRAJIT BANERJEE, DIRECTOR GENERAL, CII
The 25 basis points reduction in the repo rate, even while continuing with the neutral approach, would go a long way in lifting sentiment among businesses. The monetary policy stance taken by the RBI would provide a fillip to growth especially at a time of benign core inflation print and tepid private investment. Having said so, CII feels that a steeper cut in interest rate would have been more in consonance with market realities.
DEEPAK PAREKH, HDFC CHAIRMAN
"I think it (RBI's decision to cut main policy rate) is a good move for the economy. I think it was expected and the Monetary Policy Committee (MPC) has taken a right decision".
YOGESH NAGAONKAR, FUND MANAGER, BONANZA PMS, MUMBAI
"The market was optimistic about a cut and a 25 basis point cut is on expected lines and I am expecting two more cuts of 25 basis points each this year. The U.S. Federal Reserve`s plans on bringing down its balance sheet will not have any impact on the Reserve Bank of India`s future stance."
ANITA GANDHI, WHOLE TIME DIRECTOR, ARIHANT CAPITAL, MUMBAI
"Economic data suggests that the manufacturing slowdown is immense and it has affected Q4 FY17 GDP. The current level of inflation is at comfortable levels and leaves room for further rate cuts."
"If RBI gets confirmation that inflation will remain in the lower territory, there is a possibility of a further rate cut."
"Economic growth has come down substantially, and from that perspective, further stimulus is required for the economy in terms of reduction in the interest rate."
RAJNI THAKUR, ECONOMIST, RBL BANK, MUMBAI
"We look at the policy rate cut as a knee-jerk reaction to the current growth-inflation dynamics. Central Bank has used the policy space opened up by continued decline in inflationary pressures, reduction in global oil prices and appreciating currency."
With Agency Inputs
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