Research

RBI maintains an accommodative stance - Mr. Venkatraman Venkateswaran, Group President & CFO at Federal Bank



Posted On : 2021-12-08 18:32:24( TIMEZONE : IST )

With the economic outlook clouded by Omicron and uncertainty on growth dynamics, RBI has decided to continue the stance with an accommodative policy. RBI has been consistent in the approach of prioritizing growth over inflation for the last few quarters. The prospects of economic activity are steadily improving and a continued accommodative stance was needed for a sustained recovery in the economy. Inflation undoubtedly has gone high and is unlikely to subdue in near future. Bank loan growth over the last 6-7 months, till mid Nov was around 7%, which is still lower than the 9% CAGR between 2015 and 2020. RBI might be waiting to see a loan growth pick-up before taking any action on the rates. Also with the subdued private investments and private consumption still low, RBI believes in the need for fine balancing. Liquidity continues to be surplus; the key will be credit off-take, which can be expected in a phased manner. The VRRR will be the key tool for liquidity management in the short term.

Shares of The Federal Bank Limited was last trading in BSE at Rs. 90.40 as compared to the previous close of Rs. 89.60. The total number of shares traded during the day was 603962 in over 2290 trades.

The stock hit an intraday high of Rs. 91.45 and intraday low of 89.65. The net turnover during the day was Rs. 54433154.00.

Source : Equity Bulls

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