Banks expect rates to remain stable this yrhttps://indianexpress.com/article/news-archive/web/banks-expect-rates-to-remain-stable-this-yr/

Banks expect rates to remain stable this yr

RBI governor D Subbarao’s statement on Tuesday about an early exit from the accommodative monetary policy sent bond yields soaring...

RBI governor D Subbarao’s statement on Tuesday about an early exit from the accommodative monetary policy sent bond yields soaring and it seemed to have belied bankers’ expectation that the rate would remain unchanged in the near term. Speaking at the G-30 international banking seminar in Istanbul,Subbarao said policy rates (in India) may have to be tightened ahead of those in advanced economies. OP Bhatt,chairman,State Bank of India,said that with credit to industry from the banking sector at just above 13%—as on October 2—compared to 26% a year ago,this was not the right time to hike rates. “I do not expect a rise till the end of this fiscal.” Partha Mukherjee,president (credit),Axis Bank said he too expected interest rates to be stable till March 2010. “I do not anticipate the rates to rise. More or less the rates would remain stable,” he said. In the same vein Allen CA Pareira,CMD,Bank of Maharashtra,said RBI will have to increase its key policy rates only if inflation goes out of sync.