Chanda Kochhar, MD and CEO – ICICI Bank
The RBI has kept the rates unchanged but has raised inflation forecast in its monetary policy. It is heartening to note that the apex bank has acknowledged a positive outlook of growth due to a combination of factors such as investment, export recovery, asset resolution for large borrowers and increase in credit offtake. The removal of the priority sector cap for MSME loans will help to channel additional resources to this sector. The flexibility given to non-residents to hedge currency and interest rates is a positive move that will deepen the Indian markets.
Rana Kapoor MD and CEO – YES Bank
Monetary policy status quo is a reflection of RBI’s caution amidst recent global developments of higher crude oil prices and financial market gyrations. While RBI’s policy stance could remain unchanged in the near future, fiscal policy has taken the onus on curbing inflationary pressures via proactive management of the food economy and some rationalization in fuel taxes, if need be.
Going forward, the rollout of the FY19 Union Budget will help consolidate benefits of past economic reforms and at the same time ensure that the sustainable growth dividend is underscored by equanimity in distribution.
George Alexander, MD – Muthoot Finance Limited
As expected the central bank has maintained status-quo to sail through the current inflationary pressures and also to achieve the desired fiscal developments. The policy stance is in alignment with the industry expectations and current economic conditions.
Several macro factors like international crude prices, rising commodity prices, increase in MSP prices in the current budget, global monetary policy and the fiscal pressure will dictate the policy stance going forward.
India Inc has been patient with the regulator and awaiting the relief on the cost of funds.
Shishir Baijal, Chairman & Managing Director – Knight Frank India
The Reserve Bank of India’s Monetary Policy Committee has decided to keep the repo rate unchanged amid collective pressure from sharp spikes in crude prices, surge in bond yields, retail inflation breaching the medium-term target of 4% set by the central bank and firming up of interest rates globally. The decision has come as a relief for the real estate sector since an increase in the policy rate would trigger an adverse impact on the industry which is already grappling with a slowdown for the last 3-4 years.
Anuj Puri, Chairman – ANAROCK Property Consultants:
The Reserve Bank of India’s stance of keeping the repo rate unchanged at 6% is exactly along the lines of our expectations. Considering that the inflation has inched up (Dec-17 CPI at 5.21%, up from 3.58% in Oct-17 and well above the target of 4%), crude oil prices are rising in the international market and the Government plans to increase the crop support price, maintaining the lending rates unchanged is justified. We believe that the interest rates will soon start inching upwards, which is already being factored into the rising bond yields for the past few months. The real estate sector can and should look at the long-term economic prospects and implications on which the monetary policy decisions are based, as these will dictate the growth trajectory for the sector.