Repo rates disappoints city entrepreneurs
Reserve Bank of India's move of keeping the repo rate unchanged at 8% has come as a rude shock for the business industry in the city.chandigarh Updated: Oct 01, 2014 00:28 IST
Reserve Bank of India's move of keeping the repo rate unchanged at 8% has come as a rude shock for the business industry in the city.
Entrepreneurs said the move has come as a dampener, especially as their businesses already suffer due to the current inflation.
PHD Chambers Punjab Comittee co-chairman RS Sachdeva said businessmen were expecting a drop in the rate in the current biannual monetary policy, especially in light of the dismal growth trajectory the industry has been seeing since several quarters now.
"The growth of industrial production fell to 0.5% in July 2014 from 3.9% in June 2014," said Sachdeva.
Explaining how a drop in the repo rate would lift up the industry, PHD Chamber director Dolip said," We believe there has been a significant decline in inflation scenario during the recent months. The upside risks to inflation are also receding in the wake of softening international crude oil prices and stability in the foreign exchange market.
At this juncture, a cut in policy rates would not have served to uplift the lackluster industry growth trajectory but also be inevitable to create demand in the economy."
Repo Rate is the rate of interest at which RBI lends money to other banks.