Transmission problem remains

The RBI has done what it can, but NPA and NBFC issues are a worry

Devangshu Datta 

Devangshu Datta

The Reserve Bank of India (RBI) responded as expected in its Monetary Policy Review, with a 25 basis points rate cut, and a switch in policy to “accommodative” from neutral. It released a gloomy advisory with a reduction in Gross Domestic Product (GDP) growth estimates while holding inflation estimates. The market nosedived, because optimists were expecting a 50 basis points cut.

Let’s look at this stance in the light of corporate data. Results for the second half of 2018-19 show that interest costs have risen for most companies. Interest payments are up 15 per cent ...

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First Published: Sun, June 09 2019. 17:33 IST