Comments of Shri Melwyn Rego MD & CEO, Bank of India on RBI Monetary Policy

While Policy Repo rate and CRR have been kept unchanged, RBI has reiterated its stance to progressively lower the average ex ante liquidity deficit in the system from one percent of NDTL to a position closer to neutrality. This will help in quicker transmission of monetary policy initiatives, with MCLR framework in place, to support growth. It is comforting to note that liquidity is expected to be stable during the period of outflow of FCNR deposits.

CPI target is retained at 5 % in March 2017, though with an upside bias, and GVA growth expectation has been kept at 7.60% for FY 2017. Policy envisages continuation of accommodative stance, which is pro- growth.