“RBI has adopted a wait and watch policy. Too many conflicting data points at this point of time, exuberance reflected by the stock market thereby flaying the low GDP numbers for quarter 4, have played on the decision to maintain its neutral stance.
The statement has clearly underlined that the revival of private investment by removal of the infrastructural bottlenecks and restoring the health of banking sector by resolving NPA problem bugging the banking sector, would be the primary agenda points in the immediate future.
Banks have played their role in effective monetary policy transmission by downward revision of their lending rates. However the demand for credit is yet to pick up. Growth is the result of many more complex factors and not the repo rate alone. A deeper analysis of the domestic numbers in wake of predicted normal monsoon, expectations of FED hike, global cues may determine the course of RBI action for further monetary easing, may be in the latter half of the year.”
Ravindra Prabhakar Marathe, CEO and MD, Bank of Maharashtra