RBI Holds Interest Rates Steady Amid Positive Growth Outlook

The Reserve Bank of India's decision to maintain current interest rates aligns with expectations, welcoming the upward revision of the GDP growth estimate for FY25 to 7.2%. Bankers view this as a sign of confidence in the economy's growth prospects. Regulatory measures and digital payments initiatives were also positively received.

PTI | Mumbai | Updated: 07-06-2024 20:26 IST | Created: 07-06-2024 20:26 IST
RBI Holds Interest Rates Steady Amid Positive Growth Outlook
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The Reserve Bank of India's (RBI) decision to hold interest rates steady met with widespread approval from bankers, who had anticipated this move. The RBI also revised its FY25 GDP growth estimate upwards to 7.2%, signaling strong economic confidence.

Indian Banks' Association chairman M V Rao, who leads the state-run Central Bank of India, emphasized that the policy stance, including the unchanged repo rate, was expected. He highlighted the central bank's optimism about the economy's growth potential.

SBI Chairman Dinesh Khara concurred, noting that the revision affirms India's strong post-pandemic growth trajectory. He pointed out a favorable domestic growth and inflation outlook, with Q2 inflation dropping below 4%.

The RBI's proposed digital payments intelligence platform, designed to combat fraud with advanced technologies, was praised for its pro-customer approach by various banking leaders. S L Jain of Indian Bank highlighted the RBI's balanced approach to fostering economic growth while keeping inflation in check.

Foreign lenders like Standard Chartered's Zarin Daruwala expected the focus on inflation might offer room for rate cuts soon. Optimism also surfaced regarding rural consumption, buoyed by predictions of an above-normal monsoon, favorable for agriculture and rural markets.

Tata Capital's MD Rajiv Sabharwal supported the RBI's collaborative stance, indicating it could lead to lower interest rates and increased investments. He stressed the importance of coordination between regulators and market players for the financial sector's growth.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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