RBI may achieve below 5 pct inflation target by 2017

The Reserve Bank of India kept its repo rate unchanged at 6.75 in its fifth Bi-Monthly Monetary Policy review meting.  Cash Reserve Ratio (CRR) was held unchanged at 4 percent and Marginal Standing Facility (MSF) rate and bank rate at 7.75 percent. The advantage of previous rate cut still have to reach general public as some bank reacted to that late. 

"Implementation of the Pay Commission proposals is likely to cause some serious concerns on the fiscal deficit front due to higher capital infusion to PSU banks. The Reserve Bank of India is working closely in keeping the economy anchored to the projected disinflation path that should take inflation down to 5 per cent by March 2017", suggests Angel Commodities.