Analysts across the spectrum lauded the Reserve Bank of India's money policy, as they believe a 'wait and watch' approach is appropriate for the time being.
RBI kept all policy rates unchanged to bolster a fragile economic recovery and reiterated an accommodative stance to back sufficient liquidity and keep borrowing costs low for both the state and companies to help drive investments.
Analysts, though, saw some signs of tightening ahead in Shaktikanta Das’ speech.
“RBI signalled the beginning of gradual 'tapering'of liquidity by extending VRR auction tenor, a measure widely expected by markets. While RBI has refrained from committing any GSAP amount to support bond yields, its emphasis on an ‘orderly evolution of the yield curve’ should provide comfort to the bond market,” said Churchil Bhatt, EVP Debt Investments, Kotak Mahindra Life Insurance.
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