The Reserve Bank of India (RBI) should continue with an accommodative interest rate stance as long as necessary to sustain and further push the pace of economic growth, Assocham said on Wednesday.
While concerns over inflation, especially in the Wholesale Price Index, needed to be addressed, measures other than reversal of the accommodative stance should be encouraged, it added. “The RBI and its Monetary Policy Committee (MPC) have done a commendable job to retain the present policy rates. However, central banks in some of the developed economies are moving towards tapering the accommodative policies.
“We are sure and as we have been maintaining that the RBI would not follow this template and continue with the low interest rates,” the industry body said in a statement. “Any reversal of the accommodative interest rate stance may dampen faster revival in investment,” Assocham added.
