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Updated: September 7, 2010 17:18 IST

Kochhar expects RBI to continue with calibrated approach to check inflation

PTI
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ICICI CEO Chanda Kochhar
PTI ICICI CEO Chanda Kochhar

The country’s largest private sector lender, ICICI Bank, on Tuesday said that it expects the Reserve Bank to continue with its calibrated approach to check inflation in the apex bank’s upcoming September 16 monetary policy statement.

“The Central Bank has taken a balanced and calibrated approach. We expect the same approach going forward in the long-run to continue to check inflation,” ICICI Bank’s Chief Executive Officer and Managing Director, Chanda Kochhar, told reporters at a FICCI-IBA conference here.

Inflation continues to be high and widespread due to which the RBI may continue with its stance, she said, adding the days of excess liquidity are over but it is not yet a concern.

The RBI has been tightening key benchmark rates since November last year as the country started recovering from the impact of the global economic slowdown.

In its last policy announcement on July 27, the apex bank raised the repo rate by 0.25 per cent to 5.75 per cent and the reverse repo rate by 0.50 per cent to 4.50 per cent.

In the policy, it had also announced that mid-quarter statements will be given out, the first of which will be done on September 16.

Asked about credit demand, the ICICI Bank Chief said that credit demand will pick up in the second-half of the fiscal.

“Corporate sanctions have increased and work on projects started — therefore disbursements will also pick up,” she said.

Standard Chartered’s Chief Executive Officer for India and South Asia, Neeraj Swaroop, who was also present at the conference, said that though the liquidity situation is alright now, there is, however, an upward bias on interest rates.

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