RBI likely to further reduce CRR: Chanda Kochhar
Country's largest private sector lender ICICI Bank Monday said it expects the Reserve Bank to further reduce CRR and release more liquidity into the system, at its monetary policy review later this month.
New Delhi: Country's largest private sector lender ICICI Bank Monday said it expects the Reserve Bank to further reduce CRR and release more liquidity into the system, at its monetary policy review later this month.
"I expect there could be some CRR (Cash Reserve Ratio) cut", ICICI Bank CEO and Managing Director Chanda Kochhar told reporters.
The RBI, which is scheduled to announce its mid-quarter monetary policy on March 15, had slashed the CRR by 50 basis points to free primary liquidity worth Rs 32,000 crore. CRR is the portion of deposits that banks keep with RBI.
Kochhar, however said that the RBI may not cut the Statutory Liquidity Ratio (SLR), the portion of deposits that banks are required to park in government security, as banks are comfortable with it.
On possibility of interest rate cut, she said "inflation has settled down to some extent (but)...one has to watch what's happening on the oil prices globally...We have to look at the liquidity situation, and then gradually we need to look at the interest rate."
When asked about the central bank's move on the liquidity situation, Kochhar said, adding the RBI has been trying to balance between the need to control inflation and promote growth.
Earlier, RBI Deputy Governor Subir Gokarn too hinted at reduction in CRR, which is 5.5 percent, in the next policy review.
"Space for CRR cut still exists as we need to see significant fall in aggregate deficit," he has said.