The Monetary Policy Committee (MPC), headed by RBI Governor Urjit Patel, began its 2-day meeting on Tuesday amid experts saying that the central bank is likely to hold key rates even as the government is making a case for a lower interest regime citing low inflation.
India Inc is also pitching for a rate cut to boost GDP growth that fell to 7.1 per cent in 2016-17 from 8 per cent in the previous fiscal.
However, financial sector experts believe the Reserve Bank will likely maintain status quo at its second bi-monthly monetary policy review of the current fiscal to be unveiled tomorrow as the central bank would like to gauge the impact of GST rollout on inflation.
“Given the inflation trajectory and as the liquidity is enough in the market, it is unlikely that there would be any rate cut this time. I think commentary of the policy will be benign,” State Bank of India DMD and Chief Financial Officer Anshula Kant said.