RBI may soften policy stance in the mid-term review: Bankers

With hawkish monetary policy to contain double-digit inflation beginning to bear fruit, the new RBI Governor Duvvuri Subbarao may signal softening of stance in the mid-term review of annual monetary policy next month, bankers said today.     

"The RBI is likely to end its hawkish policy stance when it meets for the mid-term review. A set of facts like falling global crude oil prices are likely to take inflation to 7-8 per cent by April," State-run Jammu & Kashmir Bank Managing Director and CEO Haseeb A Drabu told PTI here.     

Bankers also said that the Governor is likely to take more proactive steps to push the banking sector reforms further.     

Even if RBI did not lower rates, it would certainly not tighten the monetary policy further in the near future. But the apex bank has a task in hand to bring down inflation to the targeted seven per cent by March next year, the head of a public-sector bank said.     

"We can expect the continuity in the Central Bank's actions as the policy tools available with the RBI Governor remains the same. However, given the good signals such as slowing inflation and improving fiscal discipline, the apex bank is likely to maintain status-quo in the October review," the official said.