Raghuram Rajan's RBI keeps interest rates on hold, inks status quo for bank loan EMIs

Apr 01 2014, 19:53 IST
Comments 0
According to bankers, interest rates are likely to remain unchanged and there will be no immediate impact on EMIs after Raghuram Rajan invoked inflation to spike any chance of rate cuts. (Reuters) According to bankers, interest rates are likely to remain unchanged and there will be no immediate impact on EMIs after Raghuram Rajan invoked inflation to spike any chance of rate cuts. (Reuters)
SummaryCourtesy Raghuram Rajan's RBI, EMIs for housing, car loans are unlikely to change.

the outlook for the agricultural sector is contingent on the timely arrival and spread of the monsoon.

"Easing of domestic supply bottlenecks and progress on the implementation of stalled projects already cleared should brighten up the growth outlook, as would stronger anticipated export growth as the world economy picks up," he said.

Rajan said the primary objective is to improve the transmission of policy impulses across the interest spectrum and improve liquidity in the system.

"The term repo has evolved as a useful indicator of underlying liquidity conditions. It also allows market participants to hold liquidity for a longer period...evolving market-based benchmarks for pricing various financial products," he said.

The RBI will continue to monitor liquidity conditions and ensure adequate flow of credit to the productive sectors.

"Liquidity conditions have tightened in March, partly on account of year-end ‘window dressing’ by banks, though an extraordinary infusion of liquidity by the Reserve Bank has mitigated the tightness," he said.

The Reserve Bank will propose measures to reduce such practices, he added.

The second bi-monthly monetary policy statement is scheduled to be announced on June 3.

Single Page Format
Ads by Google

More from Personal Finance

Reader´s Comments
| Post a Comment
Please Wait while comments are loading...