In his first policy decision, RBI Governor Urjit Patel cut interest rates by 25 bps. In his first ever, debut press conference as a Governor, Patel talked about subdued global growth, inflationary expectations as well as rate transmission by banks.
Read below to know - what the Governor has to say:
Navigating Monetary Policy Committee
“We have been gathering over the last day and a half that is going through lots of presentations, discussions, drafting and coming to a conclusion on the policy repo rate. We have a great MPC (Monetary Policy Committee). The three external members are of outstanding pedigree”.
Global growth
“For the first time, weak global demand is going to drag down trade volumes. It is possible that this week at the IMF (International Monetary Fund) meeting, there'll be a further possible downgrading of global growth.I'll be surprised if there isn't”.
Banks & Non-Performing Asset
“The NPA (non-performing asset) situation is an important issue for the RBI in India. We will be dealing with the situation with firmness but also with pragmatism so that the economy does not feel any lack of credit. The situation has not occurred overnight and therefore, will require a skill and thoughtful approach to resolve”.
Inflation and the HRA impact
“After the amendments to the legislations and associated notifications, the act and consequent band of +-2 is what we have to endeavor for. If you read our March 2015 statement, it also makes that very clear”.
Base rate & policy transmission
“The transmission through the money markets has been swift and decisive and the corporate are using those parts of the financial system more compared to vanilla bank credit”.