Status quo maintained on rates; along expected lines - Angel Broking

As expected, the Reserve Bank of India (RBI), in its Mid Quarter Monetary Policy Review, maintained status quo on policy rates.

The key policy rate ie Repo Rate stands unchanged at 7.25%. Consequently, the Reverse Repo Rate stands unchanged at 6.25% and the Marginal Standing Facility Rate and Bank Rate stand unchanged at 8.25%.

The Cash Reserve Ratio continues to remain at 4.00% of banks' NDTL.

The RBI has maintained its cautious guidance and indicated that its policy stance would be determined by the 1) growth, 2) inflation and 3) balance of payments (BoP) situation.

We expect an additional 50bp repo rate cut in FY2014; the timing of the same is likely to be data-determined.

Source : Equity Bulls

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