Zee Media Bureau
New Delhi: Reserve Bank of India Governor Raghuram Rajan will announce the second bi-monthly monetary policy review of FY17 on Tuesday.
Rajan will announce the policy review in the backdrop of severe charges that in order to curb inflation, the RBI Governor did not lower interest rates enough, which in turn hurt the economic activity.
The RBI had slashed bank's repo, or short term rate at which it lends to commercial banks, by 25 basis points to 6.5 percent in April, while announcing the first policy review of this fiscal year.
Considering the retail inflation at 5.39 percent which is above the RBI's near-term target, analysts are of the view that RBI may not lower lower rates in Tuesday's policy review.
The industry on the other hand, as usual has been clamouring for rate cut as performance of manufacturing and service sector in May was seen dull.