Bankers see 0.5% cut in Jan, rule out slashing lending rates
said, "We will see lower interest rates in 2013. I expect RBI to cut rates by 0.50 per cent before March and more rate cuts from April."
IDBI Bank Deputy Managing Director B K Batra said the policy review has been on expected lines, but RBI not cutting CRR was disappointing. "But RBI has given a clear guidance on future cuts and probably they left the CRR unchanged as they feel that current liquidity crunch is temporary."
Asked whether IDBI Bank will cut the lending rates, Batra said they have been doing it on select products like home and education loans. But there is no immediate plan to cut the benchmark lending rates, he added.
Bankers were expecting a 25 bps cut in the repo following a larger than expected drop in inflation numbers in the past two months.
On the positive side, the RBI clearly indicated that a rate in on the way next month and going forward its focus will be supporting growth as inflationary expectations are waning. Kochhar said the "government has also announced various policy reforms and a path of fiscal consolidation, which along with the monetary policy measures and a decision-making environment that facilitates capital investments would support improved economic performance going forward."
Asked about no change in CRR, Narendra said RBI could cut this any time. Moreover, it has said more open market operations are on the way if liquidity is further stretched.
Oriental Bank of Commerce Chairman and Managing Director S L Bansal sounded a bit disappointed, saying
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