- India set South Africa 204- run target in 1st T20
- Moderate polling in Tripura Assembly elections
- PNB fraud fuelled during demonetisation: Bengal CM
- Shame on you! student tells Trump at Florida anti-gun rally
- Modi inaugurates new BJP headquarters in Delhi
- Naval chopper tender: AgustaWestland withdraws plea from HC on bank guarantee
- Sebi may give fresh push to loan default disclosure by listed firms
Pressure mounts on RBI to cut policy rate, say experts
With inflation falling to record low levels and industrial growth slipping to below 2 per cent, bankers and economists feel the pressure has increased on the Reserve Bank to cut benchmark interest rate next month.
The six-member Monetary Policy Committee (MPC) headed by RBI Governor Urjit Patel will meet on August 1-2 for the third bi-monthly monetary policy review of 2017-18.
The MPC in its previous review in June had retained the repo rate at 6.25 per cent for the fourth straight time citing risk to inflation.
Private sector Kotak Bank is of the opinion that since the RBI has revised down its inflation trajectory sharply in the June policy, and given that inflation reading, the central bank has some room to be accommodative.
“We expect the MPC to cut repo rate by 25 bps in the August meeting,” the bank said in report.
BofA Merrill Lynch Global Research too expects the MPC to cut rates by 25 basis points (0.25 percentage point).
An SBI report said that most inflation risks are now on the downside and expect the retail inflation to be sub-2 per cent for the next month, sub-3 per cent for August-September and sub-4 per cent for October-November and 4-4.5 per cent between December and March.
For 2017-18, CPI inflation average could thus be below 3.5 per cent with a downward bias, the report added.
The retail inflation, which the RBI mainly factors in while deciding interest rate, has declined to historical low of 1.54 per cent in June. The wholesale price inflation for the month too has dropped to eight month low.
Industry chamber CII is of the view that declining inflation, which has been undershooting the central bank’s inflation target by a large margin, should induce the RBI to resume its rate easing cycle.
CII said it “strongly recommends” a rate cut of 50 basis points in the forthcoming monetary policy to provide a fillip to demand.
Commenting on the retail inflation data, Chief Economic Advisor Arvind Subramanian had said the “paradigm shift” in inflationary process has been missed by all, who have made “systematic inflation forecast error”, apparently referring to the RBI.
- Business Corner 17 Feb 2018 | Pioneer
- SRM University inks MoU with NASSCOM 17 Feb 2018 | PNS
- AAI plans to invest Rs 15k cr on airport terminals in next fiscal, says Chairman 17 Feb 2018 | PTI
- LIC posts 11.5% growth in premium income at Rs 2.23 tln in 9 month period 17 Feb 2018 | PTI
- SEBI eases accessibility for FPIs 17 Feb 2018 | PTI
- Govt expects to finalise 5G service roadmap by Jun 17 Feb 2018 | PNS
- RIL to buy 65% stake in IFC for Rs 1,105 cr 17 Feb 2018 | PNS
- Penalty up to Rs 50L/circle for predatory tariff: TRAI 17 Feb 2018 | PNS
- Fix risk management system, says India Inc 17 Feb 2018 | PNS
- ‚ÄėSBI has $212-mn exposure via PNB‚Äô 17 Feb 2018 | PTI
Sunday EditionView All
18 Feb 2018 | Gwynne Dyer
Now that Jacob Zuma has finally exited, the African National Congress, which has fallen a long way from its glory days, has one last chance to rebuild its reputation before next year’s election. Whether the ANC is the best bet for South Africans is a different question altogether As a passer-by in the upscale Johannesburg suburb of Saxonwold observed, the South African Police would never have raided the enormous, high-walled compound...
STATE EDITIONSView All
18 Feb 2018 | Staff Reporter | Raipur
Chief Minister Raman Singh on Saturday dedicated to the people of the State an interntional standard 'Swami Vivekananda Stadium' built at a cost of Rs 17 crore at Kota in Raipur. After inaugurating the stadium, the Chief Minister had a look at various facilities at the stadium...