Banks to take cue from RBI policy to decide rates: Kotak

January 04, 2010 02:23 pm | Updated 02:23 pm IST - Mumbai

Uday S. Kotak, Vice-Chairman and Managing Director of Kotak Mahindra. File Photo: Shashi Ashiwal

Uday S. Kotak, Vice-Chairman and Managing Director of Kotak Mahindra. File Photo: Shashi Ashiwal

Lending rates might move upward in the months ahead as credit growth picks up, but banks may take a cue from the RBI policy before effecting any change in their rate-structure, a top banker on Monday said.

“It (interest rate movements) will depend on the RBI policy. In my view, bank credit will pick up in the months ahead...rates may move upward,” Kotak Mahindra Bank’s Vice-Chairman and Managing Director, Uday Kotak told reporters here.

Last week, State Bank of India Chairman, O P Bhatt had said that rates are likely to remain stable till June-end despite inflationary pressures.

RBI, which is slated to announce its quarterly review of the monetary policy of this fiscal on January 29, is widely expected to hike its cash reserve ratio and policy rates to tackle inflation and suck out the excess liquidity from the system.

JM Financial’s Chairman & Managing Director, Nimesh Kampani said inflation is the primary concern of policy makers currently, which is a result of supply-side issues.

Policy makers need to adopt fiscal steps to tackle inflation, rather than opting for monetary policy actions, Kampani said.

0 / 0
Sign in to unlock member-only benefits!
  • Access 10 free stories every month
  • Save stories to read later
  • Access to comment on every story
  • Sign-up/manage your newsletter subscriptions with a single click
  • Get notified by email for early access to discounts & offers on our products
Sign in

Comments

Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.