RBI move focused on taming inflation, supporting growth: Industry groups

Industry groups FICCI and ASSOCHAM have said that the Reserve Bank of India’s (RBI) decision on Thursday to maintain pause in its third consecutive bi-monthly Monetary Policy Committee (MPC) meeting is focused on taming inflation while boosting growth. 

RBI has kept the policy rate unchanged at 6.5 per cent in its last two meetings held in April and June.

Subhrakant Panda, President, FICCI said RBI has adopted a balanced approach by maintaining the status quo on policy rates which will support growth while targeting inflation which has inched up recently. 

“The outlook remains clouded due to possible El Nino conditions, and tough global outlook calls for careful monitoring even as the policy stance remains withdrawal of accommodation while allowing previous interventions to flow through the system,” he added.

RBI Governor Shaktikanta Das said that the rate hike pause has been done with "preparedness to act if the situation so warrants".

Das said the MPC, with a majority of 5-1, has decided to continue with the withdrawal of accommodation.

ASSOCHAM secretary general Deepak Sood said that RBI’s pause focuses on ensuring sustainable growth of 6.5 per cent or more for the economy while navigating challenges of inflation-related more to weather conditions.

He also expressed confidence that the RBI would ensure adequate liquidity in the banking system for momentum to the India growth story.

Girish Kousgi, chief executive officer (CEO) and managing director (MD) at PNB Housing Finance said the decision of the RBI is positive news for the real estate industry.

“The home buyer sentiment has been strong thus far in 2023, and the stability in rates will help keep up this momentum.”

Avishek Gupta, CEO & MD, Caspian Debt said keeping rates unchanged at this stage points to the resilience of the Indian economy and this is a favourable outcome. 

“The announcement regarding the public tech platform for frictionless credit delivery, if done well, can dramatically improve credit access to underserved segments of society,” he added.

Rakesh Kaul, CEO, Clix Capital said that MPC’s decision shows RBI's commitment to support a steady economic recovery and foster an environment conducive to long-term growth.

“The unchanged repo rate is poised to deliver a much-needed anchor to both lenders and borrowers amidst the uncertain waves in the global economy, consequently catalysing an upswing in loan demand within the MSME and start-ups,” he added.