RBI gets into neutral gear - Mr. Mayuresh Joshi, Fund Manager, Angel Broking

Views of Mr. Mayuresh Joshi (Fund Manager, Angel Broking) on the Sixth Bi-Monthly Monetary Policy:

"The MPC of the RBI kept rates unchanged citing concerns emanating from spiralling crude prices, spill over effects from rising global food prices and the repercussions if any, of western policies/policy decision making that can put downward pressure on the currency. The RBI has kept its focus firmly on achieving the set out inflation targets in the desired time frame and that was the centre stage of the RBI decision making process while reducing the FY17 GVA target to 6.9% and projecting the FY18 GVA target at 7.4%. The RBI also pointed out that abundant liquidity exists in the financial/banking system and at the same time highlighted that credit growth is still languishing in single digits. The RBI stressed upon the point that the Banks need to transmit the rate cuts done by RBI so far to efficiently and effectively pass through the benefits to the entire banking universe. In a nutshell, the RBI changed its policy stance from 'Accommodative' to 'Neutral' keeping in lieu the aforementioned concerns. With this policy the RBI has gone in a 'Wait and Watch' mode and further rate cuts will be dependent upon data points both domestically and globally."

Source : Equity Bulls

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