Bankers laud RBI’s focus on disinflation

Updated - April 05, 2024 10:11 pm IST

Published - April 05, 2024 09:35 pm IST - MUMBAI

Reserve Bank of India (RBI). File.

Reserve Bank of India (RBI). File. | Photo Credit: PTI

Bankers have welcomed the Reserve Bank’s resolute focus on achieving the last mile of disinflation.

“The recent re-emergence of reflationary pressures from new supply side disruptions has posed a challenge to Central Banks, globally. Against this backdrop, the RBI’s resolute focus on achieving the last mile of disinflation is a very welcome step and will ensure macroeconomic stability,” said Zarin Daruwala, CEO, India & South Asia, Standard Chartered Bank.

“It is encouraging that India’s policy headroom to manage reflation and fresh geopolitical risks is augmented by strong underlying growth momentum and solid external sector performance,” she said.

Ashu Khullar, CEO, Citi India said, “RBI’s committed policy focus on achieving the medium term inflation target and ensuring macro stability has been made possible by a robust GDP backdrop which is firing on all cylinders.”

“There are already promising signs of success in the disinflation process but RBI is keen to extend this till the 4% CPI target is reached and growth is fostered on a sustained basis,” he said.

Ajay Kumar Srivastava, Managing Director and CEO, Indian Overseas Bank said, “The RBI MPC’s decision to keep the repo rate unchanged at 6.5% is a positive move even though retail inflation continues to be above its target of 4%.”

“With the Indian economy showing signs of strong growth momentum and stability, the GDP growth projections marked at 7% for FY25 is encouraging,” he said.

Sarvjit Singh Samra, MD & CEO, Capital Small Finance Bank said, “In a landscape of stability, the decision by RBI to maintain the status quo on the repo rates unchanged underscores the need for strategic foresight and prudent management within the banking sector.”

“The decision to expand permissible rupee interest derivative products for small finance banks underscores the imperative for agility and proactive risk management. This will help the banking sector to enhance hedging strategies, fortify resilience and navigate market dynamics with confidence,” he said.

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