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New Delhi, July 31 Reacting to the quarterly review of Monetary Policy announced by the RBI on Tuesday, industry chamber FICCI said that the increase in Cash Reserve Ratio (CRR) should have been held in abeyance.

If a hike had become unavoidable, the banks should have been paid interest on the money parked with the RBI, so that the pressure on banks to increase interest rates to the consumer is lower, the chamber said. However, it welcomed the RBI’s decision not to raise any of the key interest rates.

The Confederation of Indian Industry said that with high inflow of foreign capital into the economy, and the liquidity situation being healthy, the removal of the cap of Rs 3,000 crore on daily reverse repo auction would help manage volatility in call money rates.

Industry chamber Assocham said that the policy does not prescribe adequate measures to stop rupee from further appreciating which will hurt exporters’ sentiments and seems to have concentrated more towards taming inflation.

More Stories on : Credit Policy | CRR & Bank Rates

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