NS reserve Bank of India also suspended the G-Sec Acquisition Program (G-SAP) and proposes to introduce five 14-day variable rate reverse repo (VRRR) will be auctioned on a fortnightly basis between today and December 3, 2021.
For FY 2022, RBI retained its projection for real GDP growth further forecast at 9.5 percent CPI Inflation at 5.3 percent.
Managing Director and CEO SS Mallikarjuna Rao said, “As expected, there is no change in policy rates. Gradual and calibrated unwinding of liquidity measures will support growth while keeping inflation under check.”
Zareen Daruwalla, Cluster CEO – India and South Asia Markets (Bangladesh, Nepal and Sri Lanka), Standard Chartered Bank, said MPC has strengthened its commitment to growth while maintaining a lenient stance and repo rate.
“The RBI’s economic forecasts also point to a strong recovery amid low inflation,” he said.
Kotak Mahindra Bank Ltd. Group President – Consumer Banking, Shanti Ekambaram said that the MPC is monitoring the continued pick-up in growth in view of the slow growth pattern in some other economies.
“The policy had a ‘balanced and neutral’ tone – with continued support for development and a commitment to gradual and calibrated change in policy based on emerging data and events,” she said.
Indian Banks Association (IBA) President Raj Kiran Rai said that RBI’s decision was on expected lines as long as it is necessary to revive and sustain growth on a sustainable basis.
“RBI has laid out a roadmap for government borrowing programs and a roadmap to infuse excess liquidity from the system without disrupting the liquidity needs of the economy. Clear signals to the market help the participants to manage their liquidity needs well. are,” he said. said.
State Bank of India’s group chief economic advisor Soumya Kanti Ghosh said the RBI’s policy statement had to be very tight-lipped. “We are of the view that the normalization of reverse repo and repo corridor could possibly be delayed even after December,” he added.
Yes Bank Chief Economist Indranil Pan said the RBI spoke with its actions by not changing policy rates.
“Overall, we feel that the RBI has kept the room open for reverse rate repo hike in the upcoming December policy,” Pan said.
He said that no change in the repo rate is envisaged in the current fiscal and it can be addressed only after a thorough understanding of the growth-inflation mix developed in FY 2022-23.
Tata Capital Managing Director and CEO Rajeev Sabharwal said RBI is committed to maintain adequate systemic liquidity and pre-empt any volatility in the yield curve to achieve growth.
“Markets should take comfort from this guidance and address any concerns that may come from a faster-than-expected policy normalization. A balanced and systematic policy normalization in a phased manner would be welcome,” he added.
Y Vishwanath Gaur, Managing Director and CEO, LIC Housing Finance said that RBI’s monetary policy has once again reiterated the supportive currency and carried forward the feel-good factor.
“Overall, the unchanged rates will further improve home buying activity in the upcoming festive season,” he said.
Sanjay Palve, Senior Managing Director, Essar Capital Ltd said, “As the government’s liberal stance continues, it is no surprise that the RBI kept the repo rate and reverse repo rate unchanged.”
“It is expected to support a still recovering economy and to support sufficient liquidity to keep borrowing costs down, especially for companies that will help boost investment,” he added. ” They said.