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No immediate pressure on interest rates: HSBC

Last Updated: Thursday, January 21, 2010 - 15:48

New Delhi: Foreign lender HSBC today said
that there is no immediate pressure on lending rates even if
the Reserve Bank squeezes money supply to contain inflationary

Calling for retaining fiscal stimulus to carry forward
the growth process, HSBC India head Naina Lal Kidwai told
reporters that interest rates could only gradually rise in the
next six months.

"That (interest rate rise) is going to happen next month?
No. In the next six months... gradual," she said on the
sidelines of a micro-finance conference here.

RBI is slated to come out with its third quarter monetary
policy on January 29.

She added that inflation is a concern and will be watched,
however, monetary policy is not the only way to contain this.

Wholesale price inflation rose to 7.31 per cent in
December from 4.78 per cent in the previous month, higher than
the 6.5 per cent level by this fiscal-end projected by the

Kidwai added that there is lot of liquidity in the banks.

"Can some of these (liquidity) be mopped out? Yes... A
small Cash Reserve Ratio hike for example of 0.25 per cent
would mean just about Rs 8000 crore going out of the may signal an important change," she added.

Yesterday, the country`s largest lender, SBI, had said
that interest rates are likely to remain stable as liquidity
is surplus.


First Published: Thursday, January 21, 2010 - 15:48
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