RBI All support for the economic growth,

 RBI for boosting the Growth 

Kudos to RBI for having shifted its policy (June 6) stance from accommodative to Neutral and providing the much needed accommodative changes in its Monetary policy announcement made on 6th June 2006. Recognising the fall in inflation seen and expected , the need for giving a boost to the manufacturing segment of the economy which is slowing down,  understanding  the issues on account of geopolitical conditions, and appreciating the domestic  the present economic and environmental circumstances, the RBI has reduced the Repo rate by  0.50 percent and CRR by 1% in four instalments to add liquidity in the system and give a boost to credit growth , The relaxation in gold loans is a boon to give an impetus to Financial Inclusion and enhance the much needed relief to the weaker sections and augment their income through incentivised economic activities. The  only pitfall in the policy may perhaps be in the possible  reduction of FD rates for Senior Citizens, but if inflation is really brought down to 3.70 % as  envisaged and the expected growth in the economy becomes a reality, they may have the patience and tolerance to put up. All said the policy is very  motivating in character and  Hope  the Banks  and NBFCs will pass on the intended benefits in letter and spirit and will activate the wings to perform and realise the dreams. 

T V G Krishnan

6/6/25