RBI move reaffirms commitment to bring down inflation, says SBI’s Khara

State Bank of India (SBI) chairman Dinesh Khara said the RBI policy statement reaffirmed the commitment to bring inflation down further and ensure financial stability in markets.

“In principle, RBI from its vantage position has harmonised key measures, ensuring the economy remains cushioned to the maximum extent from the impact of inflation in everyday lives. The developmental measures are largely aimed at ensuring broad-based participation in G-Secs and the foreign exchange market. The impact of the Bharat Bill Payment system would play out over the medium term,” he said.

Shanti Ekambaram, group president and wholetime director designate, Kotak Mahindra Bank, said, “India continues to be impacted by global headwinds of geopolitical tensions, tightening financial markets and volatile commodity markets and thus inflation being above the upper targeted mark of 6%.”

“The central bank is likely to continue to ensure currency stability, manage liquidity and increase rates to manage inflation,” she added. 

Zarin Daruwala, Cluster CEO, India and South Asia markets (Bangladesh, Nepal and Sri Lanka), Standard Chartered Bank, said, “Another unanimous decision by the MPC to hike the repo rate by 50 bps and stay the course on withdrawal of accommodation, reaffirms its confidence in the domestic economic recovery. 

“Apart from reining in inflation, which is now a global concern, the hike will also bolster and stabilise the INR [rupee] in the face of geopolitical uncertainties,” she added.

Abheek Barua, chief economist and executive vice-president, HDFC Bank, said, “The RBI delivered a textbook policy announcement today [Friday] – one that is frontloaded and aggressive in response to inflation that remains high while the growth momentum remains reasonably positive.” 

Indranil Pan, Chief Economist, Yes Bank said, “As the trajectory of CPI inflation is pointing downwards, we expect the RBI to moderate the pace of hikes and raise the repo rate by 25-35 bps in September and 25 bps in December to 5.9-6% and pause thereafter to assess the growth-inflation dynamics.”