Oct 06, 2023

RBI's Decision: Balance of Growth and Inflation Praised by Experts

The Reserve Bank of India's (RBI) recent decision to maintain the benchmark interest rate has garnered approval from industry experts, who view it as a strategic move to strike a balance between inflation control and economic growth.

Mr. Amit Sarin, Managing Director of Anant Raj Ltd, welcomed the RBI's decision. While talking to Outlook Money+ Growth, he emphasized its potential to contribute to the sustained recovery of India's economic growth. He particularly noted the positive impact on the housing and real estate sector, predicting robust demand for residential properties in the upcoming quarters.

The consensus among experts is that the RBI's decision aligns with its commitment to fostering economic growth while addressing inflation concerns. The central bank's focus on withdrawing accommodative monetary policies is seen as a step toward achieving this balance.

The RBI's decision to keep the repo rate unchanged at 6.50 percent was largely anticipated and reflects its cautious approach in the face of global economic challenges. Experts acknowledge that this decision fosters financial stability and encourages consumer confidence during the festive season, ultimately supporting economic recovery.

Furthermore, the RBI's emphasis on using Open Market Operations (OMO) to modulate liquidity signals its commitment to effective monetary policy management. This approach is expected to influence bond markets and mitigate concerns about inflation.