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Below are Views On RBI Monetary Policy By by Churchil Bhatt, EVP & Debt Fund Manager, Kotak Mahindra Life Insurance Company

“During the course of the pandemic, it was RBI who did the heavy lifting in order to support growth. However, with Budget FY22, RBI has successfully handed over the growth baton to the government. In that backdrop, MPC delivered a no-change policy, with MPC’s stance remaining accommodative. The move towards gradual and non-disruptive normalization of excess systemic liquidity continues in the form of phased CRR rollback. To support bond yields amidst large government borrowing, RBI has also extended the HTM hike relaxation to FY23. However, more steps including OMOs and Operation Twist may intermittently be needed in order to contain further rise in yields. Overall, the tone of the policy remains growth supportive and fittingly complements FY22 budget.”

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