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TMI BlogRising growth concerns prompted third rate cut: DasX X X X Extracts X X X X X X X X Extracts X X X X ..... Rising growth concerns prompted third rate cut: Das - News and Press Release Dated:- 6-6-2019 - News - Mumbai, Jun 6 (PTI) The third successive rate cut of 0.25 percent is a decisive and timely move to address the rising growth concerns, and a rate hike is off the table for now with the shift to an accommodative stance, Reserve Bank governor Shaktikanta Das said Thursday. The g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnor also said liquidity--where a deficit had been bothering the financial system for nearly a year -- is in surplus now, and he vowed to ensure there is enough liquidity for every productive purpose. Assuming more headwinds to growth, the Reserve Bank also narrowed down its GDP forecast for the current fiscal to 7 percent from 7.2 percent. It can be noted that that FY19 ended with a l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower than estimated 6.8 percent, as the fourth quarter GDP printed a five-year low of 5.8 percent. The unanimous vote reflects the resolve of the monetary policy committee to act decisively and act in time (to address the growth concerns), Das told reporters after the announcement of the policy review. As expected the MPC announced a 25 bps rate cut in short term lending rate t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 5.75 percent, which is the lowest repo rate in nine years. To a specific question on the change in stance from neutral to accommodative , Das said it means that there will not be any rate hike from here. The accommodative stance would basically mean that a rate increase is off the table, Das said, but was quick to clarify that it does not necessarily mean more rate cuts ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in the offing. On what would be RBI's priority in case of a poor monsoon when it comes to propping up growth or fighting inflation-where the MPC has forecast a spike in retail price index to 3to 3.1 percent for the first half of the current fiscal--he parried a direct answer saying the weatherman is forecasting a normal monsoon. He also said the buffer stocks are 3.4 times ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the food requirement of the nation, seeking to hint that inflation may not rise because of poor rainfalls. Food inflation is the biggest component of the consumer price inflation bucket, and a sharp fall in the same over the last few months has helped RBI deliver three consecutive rate cuts aggregating to 0.75 percent in 2019. Das refused to spell out what is the real rate of int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erest--the difference between the headline inflation and the lending rate--and asked everybody to guess for themselves as to how the central bank is narrowing the gap. In a departure from the past, Das seemed to be appreciative of banks on transmission, but expected a higher and faster transmission from here on. He asserted state development loans, where retail investors are al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed now, are not risky bets at all and carry sovereign backing making it a safe instrument. When pointed out that foreign investors are keeping away from such loans, deputy governor Viral Acharya said they do so due to poor liquidity and lack of easy exit options. On a query on spike in financial frauds, Das said the report is recent and refers to the incidents taken place many ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years ago and therefore it will be unfair to assume that there is a rise in financial frauds of late. His deputy MK Jain said the RBI is also examining the Malegam committee report on frauds and will be taking suitable action on the same. On the recent Supreme Court order asking RBI to disclose annual inspection reports on banks under RTI, Das said the central bank will comply w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the order. - News - Press release - PIB Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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