RBI Governor may be waiting for cues from the Budget presentation: Gupta

Vivek Gupta, CMT – Director Research, CapitalVia Global Research Limited commenting on the issue said: "RBI in its Sixth bi-monthly policy review today announced no rate cut in the Repo and reverse repo rates but instead slashes the SLR rates by 50 basis points from previous 22% to current 21.50%.We think the reason behind this step will be that RBI Governor may be waiting for cues from the Budget presentation regarding the government’s plan to lower the fiscal deficit further on February 28 before undertaking any rate cut. As Last Month, RBI Governor R. Rajan had said that the further easing of rates would depend on “data that confirm continuing dis-inflationary pressure”. Other factors which RBI could have taken into consideration that, central bank must be waiting and watching to see the impact of call the measures that they and Govt. has taken earlier."

"As majority of market players were expecting a "no change" in policy the same was delivered and SLR slashed by 50bps this had a mixed impact on Dalal street, bench mark index nifty was trading volatile with a sharp downward movement which was later on recovered  and was trading flat," he said.