Mr. Madan Sabnavis, Chief Economist, Bank of Baroda
“The policy has left repo rate unchanged as expected and hence the markets have been quite unaffected. Quite expectedly too there have been no forecasts made on GDP and inflation next year as the new series are expected this month. Interestingly, while there is assurance on liquidity supply by RBI, no measures have been announced which means that they will be announced on need based.
Again, in line with the push given by the Budget to MSMEs, the RBI has increased the limit for collateral-free loans to Rs 20 lakh. Hence there seems to be steady follow up action to the Budget announcements.
We may expect that the rate cycle has ended and 5.25% repo rate would stand for some time before any action is taken, which is more likely in upward direction if inflation turns out to be higher in future. “