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Speaking on the monetary policy announced by the Reserve Bank Of India (RBI), Rajiv Sabharwal, Managing Director & CEO of Tata Capital said, “RBI maintains rate status quo and continues with the accommodative policy stance. The economy has gained growth momentum over the last 6 months, however, RBI will want to further nurture a broad-based recovery and will also aim at the sustainability of the same.”
“There is no upward change in the reverse repo rate as contrary to market anticipations. Also, at this juncture, RBI remains guarded against any adverse impact that may arise on account of the new Omicron Covid-19 variant,” Rajiv Sabharwal said.
“Although inflation remains a concern, moderation of crude prices and the recent cut in excise duty will work in favor of the inflation trajectory. Also, Inflation is expected to be within the comfort corridor of the RBI,” he added.
Adding to the statement, Rajiv further said, “Over the last 2 months, RBI has been using various tools that have helped absorb excess liquidity from the system. The market has taken cue of this passive approach adopted by the RBI to normalize liquidity and we have seen rates move up across the yield curve. Further, RBI has once again assured the markets that adequate systemic liquidity will be maintained to achieve growth and stability.”