MPC's optimistic growth outlook augurs well for credit demand

The MPC's optimistic growth outlook for H2 FY2024 augurs well for the credit demand for the banking sector as well as the lenders, said Karthik Srinivasan of Icra

In its February 2023 review, the Monetary Policy Committee (MPC) of Reserve Bank of India (RBI) has raised the policy rates for the sixth consecutive time since May 2022. With the recent hike of 25 basis points (bps), and a cumulative hike of 250 bps, the repo rate now stands at 6.50 per cent as compared to 4 per cent at the beginning of the fiscal. The divergence within the views of the members of the MPC increased, with two members voting for a pause as compared to one in the previous policy meeting in December 2022.

We had expected