Non-food credit growth slows to 11%: RBI
04/09/2014 16:43
India’s non-food credit growth slowed in the fortnight ended August 22, 2014, a stark reminder that business spending remains weak amid high interest rates, coming as a dampener after last week’s GDP numbers signaled a revival in Asia’s third biggest economy.
Non-food credit climbed by 11 per cent to nearly Rs 60.10 lakh crore in the two-week period ended August 22, 2014 from the same period a year ago, the Reserve Bank of India (RBI) said in a report.
In the two-week period ended August 8, 2014, non-food credit had expanded at a rate of 12 per cent from the same period a year ago.
Demand for credit remains weak as high interest rates play spoilsport. The RBI last month left its key repo rate unchanged at 8 per cent to keep a tight leash on inflation. Interest rates are unlikely to come down soon as a deficit monsoon pushes up prices of food items.
However, a pickup in economic growth, coupled with a revival in business sentiment amid the new government’s seriousness to kick-start major reforms may help boost corporate investment, bolstering demand for credit.
Meanwhile, deposits grew by 13.58 per cent to Rs 80.49 lakh crore, year on year in the fortnight ended August 22, 2014.
04/09/2014 16:43
India’s non-food credit growth slowed in the fortnight ended August 22, 2014, a stark reminder that business spending remains weak amid high interest rates, coming as a dampener after last week’s GDP numbers signaled a revival in Asia’s third biggest economy.
Non-food credit climbed by 11 per cent to nearly Rs 60.10 lakh crore in the two-week period ended August 22, 2014 from the same period a year ago, the Reserve Bank of India (RBI) said in a report.
In the two-week period ended August 8, 2014, non-food credit had expanded at a rate of 12 per cent from the same period a year ago.
Demand for credit remains weak as high interest rates play spoilsport. The RBI last month left its key repo rate unchanged at 8 per cent to keep a tight leash on inflation. Interest rates are unlikely to come down soon as a deficit monsoon pushes up prices of food items.
However, a pickup in economic growth, coupled with a revival in business sentiment amid the new government’s seriousness to kick-start major reforms may help boost corporate investment, bolstering demand for credit.
Meanwhile, deposits grew by 13.58 per cent to Rs 80.49 lakh crore, year on year in the fortnight ended August 22, 2014.
