RBI Monetary Policy: Industry leaders say RBI's accommodative stance will aid economic growth

New Delhi: Reserve Bank of India on Friday kept the key policy rates unchanged in its bi-monthly Monetary Policy review.

The central bank announcing the outcome of its bi-monthly Monetary Policy rates on February 5 said that it has decided to keep the repo rate unchanged at 4 percent and the reverse repo rate at 3.35 percent, with Industry leaders saying that RBI's accommodative policy stance will aid economic growth.

This is the first monetary policy announcement after the presentation of the Union Budget 2021-22. The Reserve Bank's rate-setting Monetary Policy Committee (MPC) began its meeting on Wednesday. The MPC kept the key benchmark rate unchanged in its last three reviews. 

Here is how the Industry leaders reacted:

Dinesh Khara, Chairman, SBI

“The RBI policy announcement today is an acknowledgment and continuation of doing whatever it takes to maintain an orderly, seamless and non-disruptive liquidity management policy to support debt management.

Rajiv Sabharwal, MD and CEO, Tata Capital

"The monetary policy, post the union budget is a true indicator of the government and RBI’s pro – investment resolve to work towards helping the economy bounce back stronger."

Shanti Ekambaram, Group President - Consumer Banking, Kotak Mahindra Bank

"In line with market expectations, the Monetary Policy Committee voted unanimously to keep key rates unchanged. The stance continued to be accommodative as long as it is necessary to support growth as the economy comes out of the pandemic."

Chandra Shekhar Ghosh, MD & CEO, Bandhan Bank

"The RBI’s plan for reviewing the regulatory framework for microfinance is a most welcome step."

Sanjay Dutt, MD & CEO, Tata Realty and Infrastructure Limited

"We welcome the apex bank’s decision to keep the repo rate and reverse repo unchanged at 4% and 3.35% respectively, for the fourth time in a row. Maintaining this accommodative outlook is extremely crucial, especially with the green shoots of recovery being visible now."

Churchil Bhatt, EVP & Debt Fund Manager, Kotak Mahindra Life Insurance Company

"To support bond yields amidst large government borrowing, RBI has also extended the HTM hike relaxation to FY23. However, more steps including OMOs and Operation Twist may intermittently be needed in order to contain further rise in yields. Overall, the tone of the policy remains growth supportive and fittingly complements FY22 budget.”