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Thursday, December 2, 2021

RBI policy on 5 February, will the RBI now get ‘Shakti’ after the budget!

After the budget, the eye is now on the RBI. On 5 February, the meeting of the MPC has started before the RBI policy. The RBI did not cut rates in the previous policy. The market will be eyeing this time on what RBI gives commentary on the huge target of financial losses. How much Shaktikanta Das gets with the Finance Minister’s formula to increase growth. The question arises as to what measures can be taken to energize the economy after the self-sufficient budget of NEW INDIA.

These issues are being discussed here. In this discussion, CNBC-Awaaz is supporting Saugata Bhattacharya, Chief Economist of Axis Bank, Jai Mehta, MD & Country Treasurer of Bank of America, DK Jeshi, Senior Director & Chief Economist of CRISIL, Lakshmi Iyer, Kotak Mahindra AMC’s DEBT & Head Product And Principal Economist of ICRA-Aditi Nair.

RBI policy on the market

RBI will introduce a credit policy on 5 February. RBI commentary on Fiscal Deficit will be monitored. However, a cut in interest rates is not expected. The challenge is to keep the rate low after the budget. The focus will be on increasing banks’ debt to RBI. The reverse repo is currently at 3.35 per cent and the repo rate at 4 per cent. SLR currently stands at 18.5 per cent and CRR at 3 per cent. CRR will again increase to 4 per cent in April. Inflation is expected to be 4.6 per cent in the first half of FY 2022.

Opinion of Awaaz MPC, will the rates change?

All the above mentioned guests included in this discussion are of the opinion that there will be no change in rates in the RBI Credit Policy Meet on 5 February. Will there be a change in policy stance? The answer to this question is also unanimous that there will be no change in RBI Stance in RBI Credit Policy Meet on February 5.

Saugata Bhattacharya’s opinion

Saugata Bhattacharya said that in FY 2022, inflation is expected to be 4.5 per cent. Reverse repo rate up to 3.75% possible in FY 2022
is. There will also be an eye on measures to increase credit growth.

Jayesh Mehta’s opinion

After the budget, the bond market needs help. Work is on to join the Global Bond Index. The roadmap of the Global Bond Index will be looked at.

Opinion of DK Joshi

Inflation is expected to be 5 per cent in FY 2022. The 10-year yield is expected to be 6.2 percent by March 2021. At the same time, a 10-year yield up to 6.5 percent is possible by March 2022. This time the policy meeting is going to be a focus on credit guarantee to unhappy institutions.

Opinion of Lakshmi Iyer

Currently inflation is not a big challenge. The roadmap of RBI’s Global Bond Index will be monitored. The reverse repo is projected to be 3.75 per cent in FY 2022.

Aditi Nair’s opinion

It is necessary to implement the Bad Bank proposal rapidly. RBI will remain vigilant about surplus liquidity. The decision to withdraw the CRR cut will also be watched. Inflation is estimated to be 4.6% in FY22.

Shehnaz is a Corporate Communications Expert by profession and writer by Passion. She has experience of many years in the same. Her educational background in Mass communication has given her a broad base from which to approach many topics. She enjoys writing about Public relations, Corporate communications, travel, entrepreneurship, insurance, and finance among others.
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