RBI may announce a benign monetary policy on 29 July: Bankers

RBI may announce a benign monetary policy on 29 July: Bankers
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First Published: Sun, Jul 27 2008. 04 35 PM IST
Updated: Sun, Jul 27 2008. 04 35 PM IST
PTI
Mumbai: With inflation plateauing and global oil prices falling, several bankers and industrialists believe that home and personal loan consumers may heave a sigh of relief as Reserve Bank is likely to announce a ‘benign´ monetary policy on 29 July so as not to impede growth.
They felt there could be no more hike in short-term key rates and cash reserve ratio (CRR) but some said if there was any hike it could be a mere 0.25% to tame inflation now at 11.89% against RBI’s forecast of 5-5.5% by fiscal-end.
CRR is the percentage of amount that banks are required to park with the Reserve Bank. Repo is the rate at which RBI lends to banks.
“Inflation seems to have plateaued...with oil prices coming down, the RBI could be expected to come up with a benign monetary policy regime,” Godrej Group chairman Adi Godrej told PTI.
Corroborating Godrej’s view, HDFC Bank’s managing director Keki Mistry and IDBI chairman, Yogesh Agarawal said it is unlikely that the apex bank would hike rates as it would be detrimental to the industry, already affected by high interest rates.
“I do not think that RBI will further hike rates at the quarterly review of monetary policy. There are no indications of a further hike in RBI key-rates. They may wait for 1-2 weeks to see how the inflation is moving,” Mistry said.
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First Published: Sun, Jul 27 2008. 04 35 PM IST