Interest rates likely to stay stable for 3-4 months: Bankers
Press Trust of India / Mumbai Oct 27, 2009, 14:38 IST
Retail and corporate loan rates may stay the same as bankers today ruled out any increase in lending rates in the next three to four months, thanks to the RBI keeping almost all key rates unchanged.
"I do not see any change in the interest rates till March. There is no liquidity problem in the system and credit off- take is less than expected," Corporation Bank Executive Director Asit Pal told PTI.
The RBI, in its quarterly monetary policy today, has said the credit growth is unlikely to meet 20 per cent target.
It has increased the Statutory Liquidity Ratio (SLR), the minimum amount the bank must park in government securities, by one percentage point to 25 per cent. But has retained the repo rate at 4.75 per cent and reverse repo at 3.25 per cent, the rates at which banks borrow and lend funds to the central bank.
Increase in SLR is just a notional issue. As it is, the banking system has over 27 per cent in SLR, Pal said.
IDBI Bank Executive Director Sushil Munhot said the signal is quite clear that the RBI does not want to hurt growth, but wants to check inflation. It is nevertheless a signal of reversal of easy monetary policy.
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