Raghuram Rajan's RBI likely to maintain status quo in Aug policy, says SBI chief

Jul 24 2014, 17:13 IST
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It is largely believed Raghuram Rajan's RBI is going to keep interest rate intact. (PTI) It is largely believed Raghuram Rajan's RBI is going to keep interest rate intact. (PTI)
SummarySBI chief's comments come ahead of RBI's bi-monthly monetary policy review on Aug 3.

State Bank of India (SBI) Chairperson Arundhati Bhattacharya today said Raghuram Rajan-led Reserve Bank of India (RBI) is likely to keep interest rate intact in its upcoming monetary policy review next month.

"I think status quo is more likely," she said when asked what her expectation was from RBI policy review.

On capital requirement, Bhattacharya said: "There are various scenarios, various requirements...at this point of time when the credit growth is not too much I am not seeing any immediate requirement. But going ahead, of course there will be requirement on the capital front."

For the current fiscal, the bank has not taken a decision on how much to raise, she said on the sidelines of an event organised by Nabard here.

Reserve Bank is scheduled to announce its bi-monthly monetary policy on August 3.

It is largely believed that RBI is going to keep interest rate intact as there is pressure on inflation due to deficient rainfall in the country.

Prices of some of the food articles like onion, tomato and potatoes have firmed up in the recent past.

In the last policy review in June, RBI chose not to tinker with the policy rate. Thus it was the second consecutive time that RBI Governor Raghuram Rajan kept interest rates unchanged.

The repo rate, at which the RBI lends to banks, was retained at 8 per cent and the cash reserve ratio (CRR) was kept unchanged at 4 per cent.

The statutory liquidity ratio (SLR), the mandatory amount of bonds lenders must park at the RBI, was cut by 0.5 per cent to 22.5 per cent of their net demand and time liabilities (NDTL) with effect from June 14.

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