No hike in interest rates on cards: SBI chief

No hike in interest rates on cards: SBI chief

New Delhi: State Bank of India (SBI) chairman O.P. Bhatt on Friday said that no increase in interest rates is expected in the near future, allaying apprehensions on the return of the tight money policy.

“Hike is extremely unlikely," Bhatt said when asked whether the rates of borrowing could be revised upward in the next few months.

He said that SBI was lending at the lowest rates and any more cut was not on the cards.

In the recent past, the country’s largest bank has been aggressive in cutting the lending rates, especially for those buying homes and cars. It is extending both these loans at 8 per cent interest per annum.

Earlier this week, finance minister Pranab Mukherjee said in Kolkata that he was against a tight money policy.

“I am not prescribing a tight money policy", he said, pointing out that the fiscal and monetary policies adopted by the government and the RBI to combat the slowdown are paying dividends and the signs of recovery have started to show up.

RBI, which has considerably eased the monetary policy to provide liquidity to the crisis-hit industry, is slated to announce second quarterly review of the monetary policy on 27 October.

With rising food inflation, there is an apprehension whether the RBI could return to the high interest regime which was followed by the central bank mostly in 2008.