India Inc seeks reversal of rate hike cycle
Expects RBI to ensure adequate liquidity in banking system and credit growth remains robust
No rate cut before Q4FY24
New Delhi: The status quo adopted by the Reserve Bank in its second bi-monthly monetary policy of the current fiscal will pave way for reversal of rate hike cycle in due course, expects India Inc. The RBI, in its bi-monthly monetary policy review, opted for a pause second time in a row, maintaining key benchmark policy rate at 6.5 per cent as inflation moderates. The rate increase cycle was paused in April after six consecutive rate hikes aggregating to 250 basis points since May 2022. This pause will help growth to become strong with the support of enhanced consumption demand in the economy, said Saket Dalmia, President, PHD Chamber of Commerce and Industry.
President of industry body Ficci Subhrakant Panda said a status quo in policy rates was largely expected and, by keeping the repo rate unchanged and maintaining the stance of withdrawal of accommodation, RBI is keeping a watchful eye on inflation while supporting growth.
“Ficci expects the impact of monetary policy interventions till date to pave the way for reversal of the rate hike cycle in due course,” he said.
Secretary General of another leading industry body Assocham said that while the Monetary Policy Committee remains focussed on withdrawal of accommodation to further rein in inflation.
