RBI Monetary policy reaction: Tourism Finance Corp India

11 Feb 2022 , 08:13 AM

“RBI continues to surprise markets, pleasantly this time, by continuing with its accommodative stance. The general market expectation was that of, some tinkering with the Reverse Repo rate. This decision of status-quo, no doubt, shall provide relief to the economy, especially affected sectors like hospitality, retail, real estate, auto, etc., for some more time.

Further, allocation of Rs2,400 crore to the Ministry of Tourism in the Union Budget this year (18.42% higher than the previous year), coupled with low interest rate regime, shall greatly benefit the hospitality sector. However, with crude in $90 per barrel range, one needs to be watchful of the inflation numbers. Sharper adjustments in the future, coupled with increasing of rates by the US Fed could lead to flight of capital and put pressure on Rupee. However, for the time being, dealing room mood is lifted for sure.”

The author of this article is Anirban Chakraborty, MD & CEO, Tourism Finance Corp India Ltd

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