RBI Monetary Policy expectation: Shriram City Union Finance

8 Feb 2022 , 06:16 PM

“We expect a Status Quo on repo rates, with a reverse repo rate hike of 25bps in the monetary policy to be announced on February 10, 2022. The RBI needs to address the rising inflation, liquidity normalization, rising long-term yields, and global tightening by Fed/ECB/BoE. On the demand front, there is renewed demand for credit with FY22 – January 14, 2022, showing credit growth of 8% but still lagging behind FY19 credit growth levels of over 14%. Interestingly, in Q3 FY22 at Shriram City, we witnessed record disbursements driven by MSME and 2W loans.

Therefore, believing credit up-tick in 2H FY22 signals a pick-up in economic activity. The Budget 2022’s infra spend will further provide support to the economy in FY23.”

The author of this article is Mr. YS Chakravarti, MD & CEO, Shriram City

The views and opinions expressed are not of IIFL Capital Services, indiainfoline.com