Market HIGHLIGHTS: Sensex, Nifty gain for fourth day, RBI MPC holds repo rate steady twice in a row

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Updated: February 6, 2020 5:57:16 pm

The S&P BSE Sensex ended 158 points or 0.39 per cent higher at 41,316.06 points while the broader Nifty 50 index settled at 12,133.65, up 44.50 points or 0.37 per cent.

RBI Monetary Policy HIGHLIGHTS: The committee had taken a pause on repo rate cut in the last meeting owing to a surge in inflation.

Market HIGHLIGHTS: Domestic equity market benchmarks Sensex and Nifty ended nearly half a per cent higher after the Reserve Bank of India (RBI) maintained the key rates steady. The RBI MPC kept the repo rate unchanged at 5.15 per cent and said that it will continue to maintain an accommodative stance as long as it takes. The reverse repo rate was kept unchanged at 4.90 per cent. The RBI MPC, in 2019, has cut rates five times in a row by a total of 135 basis points. The S&P BSE Sensex ended 158 points or 0.39 per cent higher at 41,316.06 points while the broader Nifty 50 index settled at 12,133.65, up 44.50 points or 0.37 per cent.

IndusInd Bank was the top gainer on Sensex pack, with a growth of 4.92 per cent, followed by SBI (up 3.65 per cent), Bajaj Finance (up 2.98 per cent) and Bharti Airtel (2.52 per cent). On the other hand, Infosys was the top loser, down 1.71 per cent on the index. Titan, ITC, Kotak Mahindra Bank and M&M were among the other laggards on the Sensex.

Barring Nifty FMCG, Nifty IT and Nifty Realty index, all the sectoral indices ended in green. The Nifty Bank index gained 285 points driven by IndusInd Bank, RBL Bank, Bank of Baroda, SBI and Punjab National Bank. Nifty Pharma index, too, traded higher with gains in Piramal Enterprises, Divi’s Laboratories, Dr. Reddy’s Laboratories and Aurobindo Pharma.

In the broader market, S&P BSE MidCap index jumped 118 points or 0.75 per cent to close at 15,826 points while S&P BSE SmallCap index settled at 14,721 points, up 68 points or 0.46 per cent.

Supporting growth took a back seat Thursday as managing inflation forced the RBI hand to not cut repo rate for second time in a row. In the final bi-monthly monetary policy decision for FY20, the RBI maintained the key rates steady. “These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth”, RBI MPC said. In the previous policy review in December too, the rates were kept unchanged. The MPC voted 6-0 in favor of maintaining the repo rate steady. The committee had taken a pause on the repo rate cut in the last meeting owing to a surge in inflation. The retail inflation surged to 7.35 percent in December 2019 as food prices increased higher than the RBI target. A Reuters poll of economists had expected the RBI MPC to keep the repo rate at 5.15 per cent till October 2020. 

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Highlights

    15:39 (IST)06 Feb 2020
    Closing bell

    The S&P BSE Sensex ended 158 points or 0.39 per cent higher at 41,316.06 points while the broader Nifty 50 index settled at 12,133.65, up 44.50 points or 0.37 per cent.

    15:28 (IST)06 Feb 2020
    Delicate balance maintained between inflation and growth

    "The Reserve Bank of India has kept a delicate balance between inflation management and revival of growth, with the continuation of key policy rates and accommodative stance, all in line with BWR expectations. This balancing act is at the back of inflation crossing the tolerance band particularly on account of vegetable prices, higher than budgeted fiscal deficit and subdued global activity. Further, RBI announces various measures like revised liquidity framework, conduction of longer tenor Repos maturing in 1-year and 3-year brackets, leeway in CRR (Cash Reserve Ratio) on incremental lending on credit disbursements to housing, auto sectors, and credits given to Micro, small and medium enterprises (MSMEs), linking scheduled commercial bank loans (disbursed to medium enterprises) to an external benchmark, an extension of restructuring schemes for MSME loans by a year, no asset classification downgrade for certain delayed commercial real estate projects for another one year, etc. All these measures will improve sentiments for lending, ease liquidity and reduce the banks’ cost of funding, thus, creating more space for the further transmission of rates",Balkrishna Piparaiya, Senior Ratings-Director, Brickwork Ratings, said.

    15:24 (IST)06 Feb 2020
    Bharti Airtel shares hit 52-week high, brokerages turn bullish on this telecom stock; check target price

    Bharti Airtel shares surged 3.62 per cent to hit a 52-week high of Rs 552.85 apiece on BSE backed by strong 4G customer additions of 2.1 crore, 7 per cent on-year growth in revenues and a 73 per cent year-on-year rise in mobile data traffic. Post Bharti Airtel December quarter earnings, some brokerages have turned bullish for this telecom major, with an upside of around 19 per cent.

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    15:07 (IST)06 Feb 2020
    Rural India will finally have money to buy more: RBI says consumption will revive because of this

    With an increase in rabi sowing this year, the rural consumption is also expected to revive as farmers will have more money at their disposal. While it has been a year of slowdown in the consumer sector, majorly owing to a slump in rural spendings, “private consumption, particularly in rural areas, is expected to recover on the back of improved rabi prospects,” RBI said in its sixth bi-monthly policy for this fiscal year.

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    14:50 (IST)06 Feb 2020
    Holding on repo rate twice indicates growth on backburner

    “Holding on repo rate twice indicates growth on backburner, eyes on inflation targets”, said Niranjan Hiranandani, President – Assocham & NAREDCO. He said that, “After fiscally lacklustre economic budget, the RBI’s accommodative stance by unchanged repo rate at 5.15% is a jolt to the economic growth momentum. Fiscally prudent approach to keep inflationary target in control even with liquidity lying surplus in the economy has added woes to the burgeoning liquidity crisis prevailing deep in to the economy. Reduction in repo rate would have surely helped demand uptick across the industries and brought in some relief to the end users with transmitting rate cut benefits down the line. We expect fiscally stimulating measures to enhance credit supply in the economic ecosystem to address dire need of liquidity crisis and bridge the widening trust deficit. Also, RBI’s decision to grant extension of date of commencement of commercial operations for project loans for commercial real estate would complement the government’s initiatives for the real estate sector. The positive output performance of core sectors and thrust to retail loans for specific sectors like auto, residential real estate, and MSME’s will certainly uplift the confidence and push the demand –consumption economics."

    14:44 (IST)06 Feb 2020
    RBI has many other tools to revive growth, not just interest rates, says Shaktikanta Das

    After leaving benchmark interest rates unchanged in the second consecutive policy review, RBI governor Shaktikanta Das on Thursday said the central bank has many other instruments to address the sluggishness the economy, not just interest rates. The Reserve Bank of India (RBI) in its sixth bi-monthly monetary policy pegged GDP growth for FY21 at 6 per cent, but guided towards an uncertain inflation outlook.

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    14:39 (IST)06 Feb 2020
    As many as 55 scrips hit 52-week high on NSE

    A total of 55 securities hit 52-week highs on NSE in Thursday's trade including Bharti Airtel, IRCTC, Adani Enterprises, Ajanta Pharma, Divi's Laboratories, Avenue Supermarts.

    14:17 (IST)06 Feb 2020
    Now govt will help MSMEs, startups sell their products; launches initiative to showcase solutions

    To help commercialisation of food processing and agriculture products made by startups, small businesses or to help them move products from lab to market, the government will be hosting a series of demo days showcasing such products that are government-funded. Atal Innovation Mission along with Niti Aayog, Ministry of Food Processing Industries and Ministry of Agriculture and Farmers’ Welfare organised the first demo day on Wednesday in Delhi.

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    14:02 (IST)06 Feb 2020
    IPO Alert! Indian Railway Finance Corp to be listed in March

    The initial public offering (IPO) of Indian Railway Finance Corporation (IRFC), which is part of the Centre’s FY20 disinvestment programme, will be completed by March, a senior official said. In the IPO, the Centre will piggyback the company’s proposed issuance of fresh shares to offload 5% of its equity in the company. After the IPO, the government’s holding in the company could fall to 86.4%.

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    14:00 (IST)06 Feb 2020
    HDFC, PNB Housing Finance shares jump, Godrej Properties, Oberoi Realty stocks rise too on RBI relief to realty sector

    Housing finance companies and real estate shares including HDFC, PNB Housing Finance, and Brigade enterprises, Sobha Limited, Oberoi realty, and Godrej properties jumped after the Reserve Bank of India announced a major relief to the battered realty sector from repayment of dues. Other housing financiers’ shares such as Piramal EnterprisesIndiabulls housing finance, and LIC Housing Finance Limited were also buoyant.

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    13:58 (IST)06 Feb 2020
    MPC stance that has taken note of the concerns of the real estate sector: Shishir Baijal, Chairman and Managing Director, Knight Frank India

    "We are delighted with the MPC stance that has taken note of the concerns of the real estate sector making significant announcements today. With the lower provisioning requirement for retail loans extended to the housing segment, we hope that the new measure will translate into a lower cost of loans for home buyers as well. The encouragement also comes to the development side of the business where the long-standing industry demand for asset classification has been addressed. This will augment the liquidity situation for developers too. With these two significant initiatives by the RBI, the real estate sector will hope to make a faster come back,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India said

    13:55 (IST)06 Feb 2020
    RBI has smartly lubricated the slower moving parts of the economy: Jimeet Modi, Founder & CEO, Samco Securities

    "Budget Part II was delivered by RBI in the form of lowering costs to MSMEs and bringing some life into realty sector wherein loans to commercial sector will be considered as standard (Projects which are just about to complete but are stuck due to last-mile funding gaps). RBI indeed used all its might to force banks to lower interest rates to induce transmission for the benefit of end-users, which it has partly achieved. New loans are now 69bps cheaper and old loans are cheaper by 13bps given the total 135 bps cut in 2019. Although interest rates have maintained a status quo, the RBI has smartly lubricated the slower moving parts of the economy," Jimeet Modi, Founder & CEO, Samco Securities said.

    13:52 (IST)06 Feb 2020
    A sharp rise in retail inflation in the past two readings may influence MPC decision in H2CY20: Dhiraj Relli, MD & CEO, HDFC Securities

    "In line with most expectations, the RBI MPC chose to keep the repo rate unchanged at 5.15 percent and also decided to continue with the accommodative stance. A sharp rise in retail inflation in the past two readings and inadequate transmission of rates by Banks seems to have influenced this decision. Going by the Households inflation expectation survey, the 3 month and 1 year inflation expectations are on the way down and may influence MPC decision in H2CY20," Dhiraj Relli, MD & CEO, HDFC Securities said.

    13:47 (IST)06 Feb 2020
    HDFC, PNB Housing Finance shares jump, Godrej Properties, Oberoi Realty stocks rise too on RBI relief to realty sector

    Housing finance companies and real estate shares including HDFC, PNB Housing Finance, and Brigade enterprises, Sobha Limited, Oberoi realty, and Godrej properties jumped after the Reserve Bank of India announced a major relief to the battered realty sector from repayment of dues.

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    13:45 (IST)06 Feb 2020
    RBI MPC is budget part-II

    "Budget Part II was delivered by RBI in the form of lowering costs to MSMEs and bringing some life into realty wherein loans to commercial sector will be considered as standard (Projects which are just about to complete but are stuck due to last mile funding gaps). RBI indeed used all its might to force banks to lower interest rates to induce transmission for the benefit of end users, which it has partly achieved. New loans are now 69bps cheaper and old loans are cheaper by 13bps given the total 135 bps cut in 2019. Although, interest rates have maintained a status quo, but the RBI has smartly lubricated the slower moving parts of the economy",Jimeet Modi, Founder & CEO, Samco Securities, said.

    13:37 (IST)06 Feb 2020
    India will now import oil from Russia; aims for price stability

    As part of India’s strategy for diversifying the country’s crude oil supplies from non-OPEC countries, India will now import crude oil from Russia for the year 2020. Indian Oil Corporation Limited has signed a contract with Russia’s Rosneft for importing 2 million metric tonnes of Urals grade crude oil in a bilateral meeting. According to the Ministry of Petroleum & Natural Gas, the addition of Russia as a new source for crude oil imports by India’s largest refiner will go a long way in mitigating the risks arising out of geopolitical disruptions.

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    13:36 (IST)06 Feb 2020
    RBI MPC's tone was dovish, says ICRA

    "The tone of the MPC's statement was rather dovish, especially given the reiteration that policy space is available for future action and that the accommodative stance will be maintained for as long as necessary to revive growth, in spite of the headline inflation having breached the upper threshold of the MPC's medium term target. We anticipate that the stance will be maintained as accommodative as long as the RBI perceives the output gap to be negative, regardless of the level of inflation. Accordingly, we no longer expect the stance to be changed to neutral in the next few policies.Moreover, the statement suggests the near certainty of at least one additional rate cut, even if its magnitude is modest, the timing of which will depend on how quickly inflation appears to be reverting back towards 4%. Given the dovish tone of today's policy statement, and with no further primary supply of G-sec expected until April 2020, we expect the 10-year G-sec yield to trade in a range of 6.4-6.6% in the rest of this fiscal year", Aditi Nayar, Princiapl Economist, ICRA, said.

    13:33 (IST)06 Feb 2020
    Top gainers on Sensex

    Post RBI policy outcome, IndusInd Bank was the top gainer on the Sensex pack, with a growth of 4.48 per cent, followed by State Bank of India, Bharti Airtel, Bajaj Finance, Axis Bank and HDFC.

    13:32 (IST)06 Feb 2020
    RBI's relief for realty sector

    Builders and real estate developers will now have one more year to repay their dues before they are classified as non-performing assets (NPAs) and the projects being taken over. To complement the initiatives taken by the government in the real estate sector, the RBI has today decided to permit extension of date of commencement of commercial operations (DCCO) of project loans for commercial real estate, delayed for reasons beyond the control of promoters, by another one year without downgrading the asset classification, in line with treatment accorded to other project loans for non-infrastructure sector. The Reserve Bank announced this in the statement on Developmental and Regulatory Policies.

    Read more: RBI’s relief for real estate: Builders will have one more year to repay dues before it becomes NPA

    13:31 (IST)06 Feb 2020
    RBI’s decision is a big relief for the real estate sector: Hakim Lakdawala, Group Promoter, Goodwill Developers

    “The RBI’s decision is a big relief for the real estate sector as the builders will get one more year to redo the whole thing and become financially stable. At present, defaulting three straight installments classifies the account as NPA, which is a burden, hence getting extra time is good for the industry," Hakim Lakdawala, Group Promoter, Goodwill Developers, told Financial Express Online.

    13:29 (IST)06 Feb 2020
    RBI’s relief for real estate: Builders will have one more year to repay dues before it becomes NPA

    Builders and real estate developers will now have one more year to repay their dues before they are classified as non-performing assets (NPAs) and the projects being taken over. To complement the initiatives taken by the government in the real estate sector, the RBI has today decided to permit extension of date of commencement of commercial operations (DCCO) of project loans for commercial real estate, delayed for reasons beyond the control of promoters, by another one year without downgrading the asset classification, in line with treatment accorded to other project loans for non-infrastructure sector.

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    13:28 (IST)06 Feb 2020
    Will RBI MPC resolution help in boosting realty demand?

    "In a major relief to the real estate sector and further complementing many of the previous initiatives by the government in 2019, RBI has decided to extend the restructuring of project loans by a year. Loans for projects that have been delayed for reasons beyond the control of their promoters have been extended by another one year without downgrading the asset classification. This aligns with the treatment accorded to other project loans for the non-infrastructure sector. This is a big move and will bring the much-needed relief to the cash-starved real estate sector - and to both developers and the HFCs from the liquidity perspective. It will help ease out the time for maintaining and managing cash flows for cash-strapped developers and help them to completing several stuck projects. That said, it will not address the other main issue prevailing in the real estate sector – that of continuing low demand", said Anuj Puri, Chairman – ANAROCK Property Consultants.

    13:26 (IST)06 Feb 2020
    Impact on real estate sector

    "As expected, RBI has kept the repo rates unchanged at 5.15% while maintaining an accommodative stance. Though a rate cut would have been welcomed by the real estate sector purely as a sentiment-boosting factor, a meagre change in repo rates would have done little to significantly boost consumer sentiments. As such, previous rate cuts did prompt some banks to lower their interest rates in the recent past - but that had no significant impact on residential real estate sales", said Anuj Puri, Chairman – ANAROCK Property Consultants.

    13:24 (IST)06 Feb 2020
    RBI MPC on coronavirus impact

    "There isn't any impact from the coronavirus outbreak in India as yet. But it needs to be watched very closely, especially since the pace at which it is spreading is swift. The disruption of global supply chains and its ramifications for India need to be watched closely", RBI said.

    13:23 (IST)06 Feb 2020
    Categorical statement by MPC about the possibility of rate cut should boost sentiments: Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers

    "Despite our expectation of no rate cut in 2020, the categorical statement by MPC about the possibility of a rate cut should boost sentiments. Minor fall in some lending rates, boost to bank NII. Linking credit to medium industries to an external benchmark, removal of CRR requirement on fresh retail housing and auto loans and credit to MSME are positive steps. These steps may marginally reduce the interest rates on such fresh loans. The removal of CRR select loans (~15% of banks’ outstanding loan book) is also likely to give a temporary boost to banks’ net interest income," Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers said.

    13:21 (IST)06 Feb 2020
    RIL to lose hundreds of crores in income as chemical that puts it in world’s top 5 gets cheaper

    Reliance Industries Ltd, among the world’s five largest producers of a key chemical that goes into making polyester yarns, could lose hundreds of crores of rupees in income on this business after a cut in import duties proposed in Budget 2020. Mukesh Ambani’s RIL may see its profit slashed by as much as Rs 400 crore in the next financial year 2020-21, as customers can now buy PTA (Purified Terephthalic Acid) from other sources now that the anti-dumping duty is scrapped.

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    13:21 (IST)06 Feb 2020
    Rs1-lakh crore repos to help better monetary transmission, says RBI

    RBI Governor Shaktikanta Das said the decision to conduct new one-year and three-year repos worth Rs 1 lakh crore, is aimed at ensuring better monetary policy transmission. "It is an effort to ensure better monetary policy transmission. It will enable banks to reduce their lending rates," Das said.

    13:20 (IST)06 Feb 2020
    Stock to focus post RBI policy decision

    "NBFC stocks like HDFC Ltd, M&M finance, L&T finance, Shriram transport finance, Bajaj Finance, PEL and LIC Housing finance are major beneficiaries for the move taken by RBI. In terms of banking stocks, Axis Bank, Federal Bank and IndusInd Bank are the key beneficiary. The relief for the real estate sector will be helpful for stocks like DLF, Oberoi Realty, Godrej Properties, Prestige, Sobha, etc.," Amit Gupta, Co-Founder & CEO, TradingBells said.

    13:18 (IST)06 Feb 2020
    RBI’s sees rate cuts, we do not: Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers

    "As expected, the RBI kept all major policy rates unchanged in the Feb’20 Monetary Policy. RBI expects high inflation to continue in H1 FY21 but falls sharply below 4% thereafter. RBI also expects recovery of growth to continue. It has been categorically stated, “The MPC recognises that there is policy space available for future action”.  We, however, are less sanguine on this as 12.2% in MSP hike during 2019 is likely to keep food inflation elevated despite continued softening of onion prices. Moreover, the base effects of fuel and manufactured product prices are also unfavourable. With retail inflation in 5-5.5% range in 2020, we do not expect any rate cut in the current year," Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers said.

    13:17 (IST)06 Feb 2020
    RBI MPC gives sentiment boost

    "Despite our expectation of no rate cut in 2020, the categorical statement by MPC about the possibility of rate cut should boost sentiments. Minor fall in some lending rates, boost to bank NII. Linking credit to medium industries to external benchmark, removal of CRR requirement on fresh retail housing and auto loans and credit to MSME are positive steps. These steps may marginally reduce the interest rates on such fresh loans. The removal CRR select loans (~15% of banks’ outstanding loan book) is also likely to give a temporary boost to banks’ net interest income", Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers, said.

    13:14 (IST)06 Feb 2020
    No more interest rate cut in current year

    'As expected, the RBI kept all major policy rates unchanged in the Feb’20 Monetary Policy. RBI expects high inflation to continue in H1 FY21 but fall sharply below 4% thereafter. RBI also expects recovery of growth to continue. It has been categorically stated, “The MPC recognises that there is policy space available for future action”. We, however, are less sanguine on this as 12.2% in MSP hike during 2019 is likely to keep food inflation elevated despite continued softening of onion prices. Moreover, the base effects of fuel and manufactured product prices are also unfavourable. With retail inflation in 5-5.5% range in 2020, we do not expect any rate cut in the current year',  Sujan Hajra, Chief Economist and Executive Director, Anand Rathi Shares & Stock Brokers, said.

    13:13 (IST)06 Feb 2020
    Sensex, Nifty extend gains post RBI policy outcome

    Sensex and Nifty extended the initial gains after RBI kept repo rate unchanged at 5.15 percent. The Sensex is up 170.43 points or 0.41 per cent at 41313, and the Nifty up 58 points or 0.48 per cent at 12147.

    13:09 (IST)06 Feb 2020
    Market is taking this policy on a very positive note: Amit Gupta, Co-Founder & CEO, TradingBells

    "The market is taking this policy on a very positive note where Nifty has taken out its crucial supply zone of 12100-12135. If it manages to sustain above this zone then it may head towards 12300 mark and even lifetime high can't be ruled out in the coming days while in the downside 12000-11950 zone has become a strong base," Amit Gupta, Co-Founder & CEO, TradingBells said

    13:07 (IST)06 Feb 2020
    RBI has crafted a fine balancing act of reconciling the requirements of growth with stability: Joseph Thomas, Head of Research - Emkay Wealth Management

    "RBI has kept the repo rate unchanged at 5.15% while continuing the basic accommodative stance of the policy in response to the objective of revival of growth. The budget is out, and there is a lot of clarity about the government finances, the RBI has crafted a fine balancing act of reconciling the requirements of growth with stability. In the recent policy pronouncements, the RBI had very clearly indicated that the requirements of growth should get precedence over stability, against the conditions of sluggish economic growth and the fall in consumption and investment demand," Joseph Thomas, Head of Research - Emkay Wealth Management said

    13:04 (IST)06 Feb 2020
    Indiabulls Housing Finance climbs 9%

    Indiabulls Housing Finance shares surged over 9 per cent at Rs 302 a piece on BSE after the RBI announced sops for the housing finance companies

    Check live prices

    13:02 (IST)06 Feb 2020
    RBI MPC on sluggishness in growth momentum

    "The RBI has several instruments to address the sluggishness in the growth momentum," Shaktikanta Das said. The monetary policy committee (MPC) kept the policy repo rate unchanged at 5.15 per cent, continuing with the accommodative stance to revive growth. The governor said the continuity in policy from last pause should not be read as a pointer to future actions. "While the decision is as per expectations, it is important not to discount RBI," he said.

    12:59 (IST)06 Feb 2020
    RBI MPC on onions

    On food price rise RBI said, onion prices are expected to ebb going forward. However, there is a likelihood for the prices of other food commodities to go up. "The salutary effects on headline inflation are, however, likely to be tempered by hardening of prices of other food items, notably those of pulses and proteins," it said. It also pointed to the push to headline inflation number coming from telecom prices, adding that trajectory of inflation excluding food and fuel needs to be carefully monitored as the pass-through of remaining revisions in mobile phone charges, the increase in prices of drugs and pharmaceuticals and the impact of new emission norms play out and feed into inflation formation.

    12:59 (IST)06 Feb 2020
    MPC's decision to hold the policy rate has been completely in line with our expectations: Suman Chowdhury, President – Ratings at Acuité Ratings & Research Limited

    "The MPC's decision to hold the policy rate has been completely in line with our expectations. RBI believes that the inflation outlook remains uncertain and may remain elevated through the first half of FY21. Also, it expects the interest rate transmission to be more effective and act as a growth booster as more banks link their lending rates directly to the policy rate. Therefore, any further rate cut looks a little unlikely in the next two quarters though RBI has decided to 'persevere' with the ongoing accommodative policy. The central bank has also decided to incentivise banks' lending for retail and MSMEs further by giving equivalent benefit on their CRR requirement," Suman Chowdhury, President – Ratings at Acuité Ratings & Research Limited said.

    12:57 (IST)06 Feb 2020
    This monetary policy is an extension of the budget to boost economic growth: Amit Gupta, Co-Founder & CEO, TradingBells

    "RBI keeps interest rate unchanged with an accommodative stance which was largely expected but the benefit of CRR to banks for the Auto, Home and MSME loans is a big positive for the overall market as liquidity was the main concern for economic growth. There is a big booster for the real estate sector in terms of extension of date of commencement of commercial operations of project loans for commercial real estate, delayed for reasons beyond the control of promoters, by another one year without downgrading the asset classification. So we can say that this monetary policy is an extension of the budget to boost economic growth," Amit Gupta, Co-Founder & CEO, TradingBells said.

    12:54 (IST)06 Feb 2020
    RBI was likely to continue with the pause till there is greater visibility on the inflation front: Joseph Thomas, Head of Research - Emkay Wealth Management

    "It was widely expected that the RBI was likely to continue with the pause till there is greater visibility on the inflation front. At this juncture, rate modification is actually not required as the interbank market has a huge surplus of close Rs 3 lakh crores to support the liquidity requirements of the system, and this alone will ensure that the short-term rates do not move up. The status quo comes as a relief to the short end of the curve, but the pressures at the long end may persist for longer time," Joseph Thomas, Head of Research - Emkay Wealth Management said.

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