The MPC has been treading cautiously for a while, given the uncertainty surrounding GST, the Monsoon, increase in rural wages, possible fiscal slippages on account of Farm waivers, sticky core inflation, a possible reversal in oil / commodities etc. They had also kept focus on cleaning up Bank Balance Sheets – Consequently, the RBI did not want to take any premature action and rightly so! With most of the uncertainty now clearing, the RBI has finally delivered – In exactly 9 months (the last cut was in Oct 2016)! The stance now changes from “Wait and Watch (the MPC stand for the last 9 months!) to Watch and Wait (Watch for Transmission and Wait for Credit Growth!)”.
- Mr. V.S. Parthasarathy,
Group Chief Financial Officer & Group CIO, Mahindra & Mahindr