India Inc expects another 35-50 basis points policy rate hike by RBI

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Sep 23, 2022

India Inc is bracing itself for yet another policy rate hike by the RBI Monetary Policy Committee in the range of 35-50 basis points as the move seems unavoidable in the wake of the global monetary tightening to limit the impact of inflation, ASSOCHAM has said. The chamber has sought a balanced and smooth transition to the new trajectory for borrowing costs.

Seeking several measures for ensuring that adequate liquidity is maintained within the system, the ASSOCHAM has said '' 35-50 bps rate hike seems imminent and inevitable while the MPC may leave the CRR and SLR rates unchanged''.

ASSOCHAM president Mr Sumant Sinha said while 35-50 bps increase in the benchmark rates seems unavoidable at this point of time given the continuous monetary tightening by the US Federal Reserve and other central banks. He however noted that economic activity is at robust levels. “India is in a sweet spot with growth coming from all quarters and inflation is relatively in control. Softening of crude prices will augur well for the economy and we should start the interest rate cut cycle from early part of FY24.”

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