RBI MPC Meet Live: Change in stance?
Experts foresee a shift in the monetary policy stance from the present position of withdrawing accommodation to a neutral one. They have observed the Reserve Bank of India’s acceptance of excess liquidity in the banking system, interpreting it as a willingness to allow marginally more relaxed financial conditions while maintaining the current benchmark policy rate.
The central bank has allowed surplus liquidity conditions to prevail since July, with the exception of a brief period in September when quarterly advance tax payments temporarily drained funds from the system. This decision comes in the context of credit growth surpassing deposit growth and substantial foreign investments in Indian debt securities.
