December 16, 2024 09:47 (IST)
Follow us:
facebook-white sharing button
twitter-white sharing button
instagram-white sharing button
youtube-white sharing button
Bangladesh likely to hold national polls in late 2025 or early 2026, says Yunus in Victory Day speech | Constitution stood test of time: Nirmala Sitharaman in Rajya Sabha | PM Museum requests Rahul Gandhi to return Pandit Nehru's historical letters | Indian tabla maestro Zakir Hussain dies at 73 in San Francisco, confirms family | Kolkata woman strangled, beheaded and chopped into pieces for refusing brother-in-law's advances | Arvind Kejriwal, CM Atishi to contest Delhi polls from current constituencies | Atul Subhash suicide case: Wife Nikita, her mother and brother arrested | Pushpa 2 stampede: Allu Arjun walks out of jail, actor's lawyer slams delay in release | Donald Trump intends to end 'inconvenient' and 'very costly' Daylight Saving Time | Suchir Balaji: Indian-origin former OpenAI researcher found dead at US apartment

RBI keeps repo rate unchanged, receives mixed reviews

| | Dec 08, 2016, at 12:37 am
Mumbai, Dec 7 (IBNS): The Reserve Bank of India's (RBI's) decision to stick to its old repo rate garnered mixed reviews from the markets.

While some said they were happy with it, others have termed it as a disappointment.

Chanda Kochha, MD and CEO of ICICI Bank said, “The RBI has maintained stability in monetary policy with a focus on the medium-term inflation targets being sustainably achieved, while continuing to be supportive of growth. The policy has maintained an accommodative stance while taking into account global developments and domestic economic conditions."

KVS Manian, President, Corporate, Institutional & Investment Banking, Kotak Mahindra Bank Limited, said, “There was a  broad expectation for a 25 basis points repo rate cut, which would have given banks room to cut lending rates. To that extent, the markets are disappointed. But the withdrawal of the incremental CRR effective December 10, 2016, does  give banks some flexibility to cut rates."

Manian said that the RBI seemed far less sanguine on inflation than the rest of the market.

He said that with this move, the RBI has shown faith in the market and is optimistic that things will be normal following demonetisation.

"On demonetization, the message from the central bank seems to be that that things will get back to normal soon, and they see it as transitory. On that front, they seem far more optimistic than the market,” Manian added.

Reacting on the same, Anuj Puri, Chairman & Country Head, JLL India, said, "For the real estate sector, which is currently reeling under pressure from the recently-announced demonetization of high-value currency notes, a rate cut could have definitely allayed fears of a near-term loss of momentum."

"What could offer the real estate community some respite is if the policy committee would continue to remain accommodative and act positively on any opportunity available for rate cuts as soon as they arise going forward," he added.

Contrary to the expectations of many,  Reserve Bank of India Governor Urjit Patel left the repo rate unchanged in the first policy meeting post demonetisation, reports said.

The six-member  Monetary Policy Committee (MPC) of RBI decided not to cut the repo rate from 6.25 percent.

The Monetary Policy Committee (MPC)  in its October policy review had cut interest rate by 0.25 per cent .

The RBI's decision triggered a fall in the stock market with the BSE Sensex and NSE Nifty going down.

Support Our Journalism

We cannot do without you.. your contribution supports unbiased journalism

IBNS is not driven by any ism- not wokeism, not racism, not skewed secularism, not hyper right-wing or left liberal ideals, nor by any hardline religious beliefs or hyper nationalism. We want to serve you good old objective news, as they are. We do not judge or preach. We let people decide for themselves. We only try to present factual and well-sourced news.

Support objective journalism for a small contribution.