Industry asks RBI to moderate rate hikes

New Delhi, December 2

Industry body Assocham has asked the RBI to moderate the interest rate hikes so that it does not have adverse impact on nascent economic recovery.

Policy interest rates have gone up by 190 basis points since May as the inflation rate had seemed untamable without giving up on Covid era’s low interest rates.

The call by the industry chamber comes ahead of the RBI’s three-day meeting from Monday which will take a call on further interest rate hike. The decision of the six-member Monetary Policy Committee will be announced by RBI chief Shaktikanta Das on Wednesday.

“At most the new rate hike should not exceed the 25-35 basis points band,” said Assocham in a letter to the RBI Governor while calling it to treat retail loans for purchase of electric vehicles as priority sector lending, with a concessional rate of interest.

On September 30, the RBI had hiked the key repo rate by 50 basis points with an aim to check inflation which continues to remain above the upper tolerance band of 6% since January this year.