RBI status quo on policy rates by RBI was in line with consensus and our expectations :Expert
Mumbai, Dec 6 (UNI) The Reserve Bank of India (RBI) on Wednesday hold the short-term lending rate, also known as repo rate, unaltered at 6 per cent in its fifth bi-monthly policy review of the fiscal year here what the expert has to say about it Mr. Naresh Takkar MD and Group CEO ICRA Limited said With an intensification of the inflation risks related to commodities and perishables since the last review, the six-member Monetary Policy Committee (MPC) expectedly stayed on hold in the December 2017 policy, with a split vote of 5:1.
Moreover, it retained the neutral stance of monetary policy, balancing a slight uptick in its inflation projection for H2 FY2018, with a retention of the GVA growth forecast, which essentially entails a sharp pickupin economic expansion in the latter half of the year.
The tone of the policy document was not particularly hawkish, which mildly cooled the 10 year G-sec yield. Nevertheless, the expected uptick in CPI inflation spells a low likelihood of rate cuts in the immediate term.