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RBI monetary policy: Economists and money market experts weigh in

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RBI monetary policy: Economists and money market experts weigh in

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The Reserve Bank has decided to keep rates unchanged and has maintained the accommodative stance. Further, the RBI governor has said that accommodative stance will continue into the next fiscal.

The Reserve Bank has decided to keep rates unchanged and has maintained the accommodative stance. Further, the RBI governor has said that accommodative stance will continue into the next fiscal.
CNBC-TV18 spoke to a host of economists and money market experts on how they read the announcements from the RBI.
Ashish Parthasarthy, Treasurer at HDFC Bank said, “Last year was extremely extra-ordinarily and so the monetary policy was extra-ordinarily accommodative. Now we are coming out of that very clearly and all the projections across government, RBI and other economist are for a reasonably high level of growth this financial year putting those two together and possibly there are some concerns of inflation, but if you see the inflation trajectory as projected by the RBI it is 4.3 percent for Q3 of FY22. So my takeaway is we will not be in an extra-ordinarily accommodative policy but we will be in accommodative policy for a long period of time.”
On inflation DK Joshi, Chief Economist at CRISIL said, “The inflation has been quite unpredictable in the past and has generally stayed above the RBI’s comfort for quite some time. The developments on inflation are somewhat idiosyncratic also because the commodity price cycle, there are many other things that will come into play, so there are some worries I guess on the inflation front but overall if you see the movement of the economy, I think the growth is going up inflation in the recent past has surprised on the positive side. I think it has come out much lower than expected earlier.”
Pronab Sen, Former Chief Statistician said, “I don’t think inflation is such a great concern as yet, it is unlikely to breach the RBI’s comfort zone very much. So I think on the inflation front we are okay.”
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