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Below is Perspective on RBI MPC Policy by Mr. Nitin Shanbagh, Head – Investment Products, Motilal Oswal Private Wealth

“RBI continues to prioritize growth and maintain financial stability as far as necessary. Having said, it remains mindful of anchoring inflation expectations.

While maintaining a balance between growth/inflation dynamics, RBI is likely to continue with orderly evolution of the yield curve through OMOs & GSAPs. Till durable growth recovery is seen, RBI may not resort to reversal of policy rates and would maintain sufficient liquidity in the system. However, RBI may gradually signal towards normalization of rates.

From investors point of view, focus should be towards investing in high quality roll down accrual strategies through a bar-bell approach viz. combination of short term and long term maturity strategies with weighted average portfolio average maturity of 4-5 years. For yield enhancement, investors can also consider investing upto 25% in well researched REITs, InVits, select high yield MLDs, etc.”

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