Interest rates have almost peaked: SBI

Interest rates have almost peaked and are unlikely to change unless the Reserve Bank of India (RBI) further tightens monetary policy, State Bank of India (SBI) Chief O P Bhatt said today.

SBI, the country’s largest lender, had raised its prime lending rate by 100 basis points to 13.75 per cent yesterday in response to a further hike in RBI’s key lending rate in the last week of July. “They have almost peaked,” Bhatt told reporters here. He cited softening oil prices, a good monsoon and lower prices of commodities, except steel, as factors indicating a peak in interest rates.

 

“The demand pull from Beijing Olympics is also over, the global economy is slowing down. So there seems enough reason that it has peaked or nearly peaked unless there is any further cause for action by external factors or by the RBI,” he added.