SME Times is powered by   
Search News
Just in:   • Merger of BoB, Vijaya, Dena banks in 4-6 months: BoB MD  • Trump to slap tariffs on $200 bn worth of Chinese goods  • Encourage greater value addition for MSMEs, Prabhu to G20  • Rupee hits fresh lifetime-low again, now at 72.97/$  • Apple iOS 12 with new tools now available globally 
Last updated: 02 Apr, 2018  

RBI.Thmb.jpg RBI policy review

   Top Stories
» Encourage greater value addition for MSMEs, Prabhu to G20
» Rupee hits fresh lifetime-low again, now at 72.97/$
» Nasscom to mentor 100 tech startups every year
» Goyal inaugurates first ever India tourism Mart 2018
» Jaitley hints at no immediate cut in fuel prices
Bikky Khosla | 02 Apr, 2018

The Reserve Bank of India will review its monetary policy on 4-5 April. In its last review in February, which took place against the backdrop of fiscal slippages, pressure on inflation and rising oil prices, the policy rate was left unchanged at 6 percent. But the tone was cautious. The decision to not change the repo rate was taken with a 5-1 vote, with one member calling for a quarter percentage rate hike. This time again, it is widely viewed, the central bank may maintain status quo.

It is estimated that inflation may average around 4.6 percent in January-March quarter, lower than the RBI's projection, but it is unlikely that the central bank will not take into account the inflationary risks in the form of higher oil prices, increase in Minimum Support Price and Pay Commission payouts. On the other hand, a broad based industrial recovery was witnessed in the past two months, indicating a strong cyclical recovery. It seems the central bank will follow a 'wait and watch' policy as of now amid these conflicting trends.

Such a balanced approach is expected by the Indian industry as well. It is pointed out that as inflation has started coming down a status quo in rates would address the upside risks to inflation while addressing the aspirations of growth. Some experts are also of the view that the central bank should maintain sufficient liquidity in the bond market in order to keep interest rates moderate. Also, demands are raised that the RBI's banning of letters of undertaking for trade finance should be lifted, particularly for SMEs.

Meanwhile, the trade war between the US and China has continued to escalate, with the latter slapping a tariff as high as 25 percent on 128 American products. The move came after Trump administration's imposition of trade charges of up to $60 billion on Chinese imports despite Beijing's stern warning. This is not a good sign for global trade as well as India's exports. Additionally, if the conflict continues, the Rupee could be adversely affected and the RBI may in such a situation go for rate hikes to protect the currency.

I invite your opinions.

Print the Page Add to Favorite
Share this on :

Please comment on this story:
Subject :
(Maximum 1500 characters)  Characters left 1500
Your name:

loan for small scale industries
srustidhar patra, bhiwadi, Rajastan | Wed Apr 11 12:40:08 2018
Dear sir , Please give loan

  Customs Exchange Rates
Currency Import Export
US Dollar
UK Pound
Japanese Yen 58.85 56.85
As on 18 Sep, 2018
  Daily Poll
Is counterfeiting a major threat to SMEs?
 Can't say
  Commented Stories
» A GeM of opportunity(9)
» Starting an import export business: Basic guide for beginners(3)
» GeM mission launched to promote MSMEs, start-ups: Prabhu(1)
» CAD rises to $15.8 bn in first quarter on high trade deficit(1)
» AI start-ups blossom in India, need big dollars to grow(1)
About Us  |   Advertise with Us  
  Useful Links  |   Terms and Conditions  |   Disclaimer  |   Contact Us  
Follow Us : Facebook Twitter