MUTUAL FUNDS

RBI's decision to maintain the policy status-quo has disappointed the market<
20-Jun-12   10:10 Hrs IST
1) RBI in its mid-quarter monetary policy review has kept the repo rate and cash reserve ratio (CRR) unchanged, what are your reactions towards it?

RBI's decision to maintain the policy status-quo has disappointed the market. Though; given the latent inflationary pressure on the economy from the steep decline in the Rupee, this position is understandable. Having said that, the stated precedence given to liquidity management through OMO, may be a precursor to active RBI participation in days ahead. This could lead to supporting of the long term gilt yields in the near future despite supplies.

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