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Rate transmission to gain momentum amid easing liquidity


RBI through OMOs and currency swap has turned liquidity in the banking system positive at ₹1.42 lakh crore. Banks were reeling under pressure from elevated cost of funds
In parallel, several banks—including HDFC Bank—have begun to lower interest rates on selective deposits, which depicts improvement in liquidity crunch faced by the system.
Overall, RBI’s liquidity infusion and accommodative stance on liquidity, has set a tone for a sustained liquidity environment and thus a more balanced transmission of anticipated rate cut which is expected to bolster credit growth and ease pressure on margins.
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