#RBI keeps repo rate unchanged at 6.5% while being vigilant on inflation projection.
#AxisBank's Rajiv Anand, #UBS' Tanvee Gupta Jain and #BofA's Jayesh Mehta join in to discuss the policy highlights. #BQLive
#AxisBank's Rajiv Anand, #UBS' Tanvee Gupta Jain and #BofA's Jayesh Mehta join in to discuss the policy highlights. #BQLive
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00:00 Well, the policy statement has been digested well.
00:03 And amongst the key highlights, you
00:05 could argue that the thought around how global policy
00:10 rates may stay higher for longer, or the move on the ICRR,
00:16 and a couple of other points stand out.
00:19 Without much ado, let me get in a very special guest
00:21 to try and understand what his thoughts around the policy
00:23 were.
00:24 Mr. Rajiv Anand, Deputy Managing Director of Axis Bank,
00:26 joins us right now on the show.
00:27 Rajiv, it's been a while.
00:28 Thank you for taking the time out, much appreciate.
00:31 What stood out in the policy for you, may I ask?
00:34 Thank you, Neeraj, for having me.
00:36 Yes, it's been a long time.
00:39 I think the policy was really on expected lines.
00:43 What did the markets expect?
00:45 Markets expected that-- they were
00:49 hoping that the RBI will see through the tomato inflation.
00:56 The market knew that there was about 250,000
00:58 crores of surplus liquidity sloshing around.
01:02 And so they were trying to figure out
01:04 what the RBI would do as far as this excess liquidity is
01:08 concerned.
01:09 And I think, therefore, to that extent,
01:11 we got the incremental CRR coming through.
01:14 The good news is that the total impact to the banking system
01:19 is that it takes out about 1 lakh crores
01:22 for a period of about one month.
01:24 I think the review is on 8th of September.
01:28 So therefore, I think that it's a good move.
01:31 It's a short-term move.
01:34 And I think, to that extent, the fact that the policy measure--
01:40 the rates have been kept stable, A.
01:45 And B is there's been the short-term measure
01:48 around liquidity is something that--
01:54 I think, broadly speaking, was expected.
01:57 The fact that we have seen them redo inflation numbers
02:03 and inflation numbers quite strongly
02:06 over the next nine months or so, I think, is a bit of surprise.
02:12 And I think what it clearly means
02:14 is that any expectation of a rate cut
02:17 is now off the table at least till 31st March 2024.
02:23 And therefore, we are going to be
02:24 in a high of a longer environment.
02:27 And I think that is something that we need
02:29 to reconcile ourselves with.
02:31 Yeah, I mean, global policy rates plus the fact
02:33 that they said that we hope that the food inflation goes away,
02:37 no clear certainty out there.
02:38 A couple of things, and one question from my end
02:41 was whether this liquidity--
02:45 gosh, I mean, when the move's been
02:48 taken to withdraw 2,000 notes, you
02:50 would expect that that would come into the system.
02:53 So in that sense, should it have been preempted?
02:55 And is this ICRR, usage of ICRR, a bit of a surprise?
03:00 I mean, ideally, it should have been preempted that something
03:03 like this will happen?
03:05 I think, no, it's a fair point.
03:08 And I think the way that the RBI governor explained this
03:13 is there are multiple choices.
03:15 I mean, you can easily use VRR, et cetera.
03:18 The RBI had multiple choices in front of them.
03:21 They felt that the incremental CRR is the best
03:28 option at this point in time.
03:30 I've been around in the markets for a long, long time.
03:33 And this whole thing around incremental CRR, et cetera,
03:36 just complicates calculations a bit.
03:39 And I remember having complex Excel spreadsheets
03:44 as a result of that.
03:46 So it just brings back a bit of a deja vu,
03:49 because RBI, over a period of time,
03:51 has simplified CRR calculations.
03:53 And to that extent, they're just going back a bit on that.
03:57 But like I said, it's a temporary measure,
03:59 and nothing that should trouble us too much.
04:06 Mr. Anand, a little bit more on the incremental CRR.
04:10 What's the expected impact?
04:12 Would it be fair to say that short-term rates are now
04:16 expected to see a little bit of an uptick?
04:19 And adding to that, would it also
04:22 be correct to say that bank balance sheets are
04:25 likely to see minimal impact, considering
04:27 it's a short-term measure?
04:30 Absolutely.
04:31 The total impact, I mean, in revenue terms,
04:35 let's just look at the numbers.
04:37 It's about 1 lakh crores is the impact,
04:39 like I mentioned to you, for about a month,
04:42 assuming that money would have, under normal circumstances,
04:46 been put away in overnight liquidity at 6.5%.
04:54 That effectively means that you're
04:55 talking about 500 to 600 crores of impact
04:59 for the entire banking balance sheet.
05:01 So therefore, to that extent, there
05:02 is going to be an impact on liquidity,
05:05 but there is no material impact as far as bank P&Ls
05:09 are concerned.
05:11 Yes, we should expect a little bit of an uptick
05:15 in terms of the very short-term rates.
05:19 But remember, the system is still surplus.
05:22 And so therefore, that uptick is not going to be significant.
05:27 OK.
05:29 Rajiv, there was a fair degree of conversation
05:32 around the Vostro account and where is the refined rupee,
05:38 if you will.
05:38 I'm just trying to understand.
05:40 Do you have thoughts here?
05:41 Because there were four or five questions directed
05:43 at the Reserve Bank of India.
05:44 Maybe they can't say, but they didn't give out
05:47 an exact answer of any measure whatsoever,
05:49 not even about the expectations that the market has
05:54 with regards to this.
05:55 Do you have any thoughts here?
05:58 And could there be an issue of sudden withdrawal of liquidity
06:03 that could happen?
06:05 Or would it be very measured because it's
06:07 a trade between nations and doesn't quite happen overnight?
06:11 It doesn't happen overnight, Neeraj.
06:14 This is money that has gotten built up over a period of time.
06:18 And let's just say that much of this money
06:22 has gotten built up thanks to the geopolitical situation
06:26 that we are in.
06:27 There is no clarity on how much that money is,
06:31 when that money is going to leave the system, if at all,
06:35 and how that is going to leave.
06:38 And so therefore, we'll have to work through this
06:41 as we go forward.
06:43 OK.
06:44 I have one question.
06:45 Maybe Pallavi has more.
06:46 But I have one more question for you, Rajiv.
06:48 And that is the worry that maybe even the risk-asset markets
06:54 have around what China does.
06:56 The Reserve Bank of India was asked about Chinese deflation
06:58 slowdown.
06:59 And I think I heard Mr. Michael Patra say that, as of now,
07:03 it is not even a recession.
07:05 Maybe a bit of a growth slowdown.
07:07 IMF predictions of 5.2, which is maybe lower but not bad.
07:12 You, as running such a large, successful bank,
07:15 are you concerned about the data emanating from China?
07:18 There is a lot of chatter in the last two days
07:21 around the property sector in particular
07:23 and how it could even dwarf what happened
07:27 when Evergrande happened.
07:28 So any thoughts that you have particularly on this?
07:34 I would look at it in multiple ways
07:37 as someone working in a bank.
07:42 One is the impact on our corporate clients.
07:46 And I think by definition, the fact
07:49 that China is relatively weak should by definition
07:54 mean that any pressure on commodity prices is unlikely.
07:59 And so therefore, users of global commodities
08:06 may not necessarily benefit, but will not get impacted.
08:10 Yes, there could be some impact on commodity companies
08:14 at this point in time.
08:15 And we'll have to, like I said, just figure out
08:18 how this is going to play out.
08:22 I think ultimately, from a geopolitical and geoeconomic
08:27 perspective, the playthrough really is through global flows.
08:34 And I would imagine that as China continues to weaken
08:39 or some of these data points come out
08:45 on a month-on-month basis, which are relatively weak,
08:48 I would imagine that India should be a beneficiary.
08:51 Because on the other side, I think
08:53 growth in India will continue to be strong.
08:56 You heard RBI today say that growth
08:59 should be in the vicinity of 6.5% for the current year.
09:03 I think in the context of where we are globally,
09:06 I think those are very strong numbers.
09:08 Yes, there is a bit of worry about inflation,
09:13 but it's not anything that is untoward, at least
09:17 at this point in time.
09:19 And so therefore, from a global flow perspective,
09:22 we should certainly benefit.
09:23 And that, once again, is good for the rupee.
09:27 And so therefore, relatively weaker commodities
09:30 and stronger flows should mean that either we
09:34 will see strength on the rupee or the RBI
09:37 comes in and intervenes, which means
09:40 that liquidity will continue to be relatively easy as we go
09:44 forward.
09:47 So Mr. Anand, we did touch upon growth indicators looking up
09:51 at this point domestically.
09:53 I do want to ask you a little bit more
09:56 about what the corporate loan book is looking like
09:59 and the reasons at this point, despite the optimism
10:03 around private capex, I think it would
10:06 be fair to say that it's government capex that's
10:09 actually leading Indian growth.
10:11 So what's the corporate loan book looking
10:13 like in terms of capex?
10:16 Our own estimates is that bank credit will probably
10:20 grow somewhere between 13% to 15% this year.
10:25 But within that, we are certainly
10:27 seeing a very good growth on the corporate side.
10:33 And it is well diversified across multiple sectors.
10:38 Part of it is working capital.
10:40 Part of it is refinance.
10:41 Part of it is private capex.
10:44 And we are having multiple conversations
10:45 with our customers about capacity expansions.
10:49 But I must also say that corporate balance
10:52 sheets are in probably the best shape
10:54 that we've seen in a decade.
10:56 And I do see an element of aversion
10:58 to leverage within the corporate community, which
11:02 means that, yes, they are increasing capacities.
11:05 There is the confidence to increase capacities.
11:07 But in many, many cases, they are
11:10 using their own internal cash flows
11:13 to be able to support this capex.
11:17 Only a small part of it is coming to bank credit.
11:21 But I can say with a great deal of conviction
11:24 that the private capex cycle has well and truly kicked in.
11:30 Yes, it can certainly get much better.
11:33 But it is certainly much better than what
11:35 we've seen, let's say, over the last three years.
11:37 So just a quick follow-up, Rajiv.
11:39 I'm tempted to ask this to you before we wrap up.
11:41 In your experience, having looked at multiple cycles,
11:44 do you reckon it's sooner rather than later
11:46 that private sector comes looking for bank credit
11:51 as well?
11:52 Or is it difficult to see at this point of time
11:54 based on what you just said?
11:57 I think what you're going to see is
12:00 that corporates will use different instruments to fund
12:08 their long-term growth.
12:10 And so therefore, banks like us, it's
12:12 very important for us to be able to support them
12:15 across the capital structure.
12:17 So if they want equities, we should
12:19 be able to raise equities for them.
12:21 If they want to raise bonds, we should be able to help them.
12:23 And we are very happy to provide our balance sheet to support
12:28 them with their growth.
12:29 And so therefore, to answer your question,
12:31 I think increasingly large corporates
12:33 will use some part of their growth requirements
12:38 through banks.
12:39 But they will also use both local and domestic bonds
12:44 for their requirements.
12:46 But as you go lower into mid-corporates and SMEs,
12:51 they will predominantly be funded by banks.
12:54 And you are seeing, for example, for us,
12:57 if you look at the MSME and up to mid-corporate, which
13:00 is basically companies up to 1,000 crores,
13:03 that book is granular, is well-diversified geographically,
13:11 sectorally, and is growing in excess of 30%.
13:14 And it's not a small book.
13:16 We really like that book because of the fact that, like I said,
13:19 it is well-diversified in terms of risk.
13:21 And so therefore, there are certainly
13:24 pockets of opportunities within the mid-corporate and SME
13:29 space.
13:30 And there will be opportunistic opportunities
13:33 in the large corporate space.
13:35 Lovely talking to you today.
13:36 Thank you so much for taking the time out
13:38 and giving us a lowdown on multiple things, not just
13:40 the policy.
13:40 Appreciate your time.
13:42 Thank you so much, Neeraj.
13:43 Pleasure was ours.
13:45 Well, so that's Axis Bank with their views on policy.
13:50 No surprises thereof.
13:52 And I thought the fact that he said that--
13:55 I mean, the important point that comes out from the policy,
13:57 amongst other things, is that any kind of rate action
14:00 from the Reserve Bank is well and truly ruled out.
14:02 For FY '24, at the very least, we
14:04 take it a quarter from there and figure out what happens.
14:09 At least until then, we're not seeing
14:10 any kind of rate tinkering from the Reserve Bank of India,
14:13 unless things stand.
14:14 Absolutely.
14:14 I think one of the key takeaways from today's policy
14:17 has been higher rates for longer.
14:20 Up until recent days, even up until the policy,
14:24 I think there was a little bit of division
14:27 between analysts and economists as to whether a rate
14:31 hike could happen, possibly, at the end of this year
14:35 or in the fourth quarter of this fiscal.
14:39 After today's policy, I think the central bank
14:42 has reaffirmed that there's a greater chance
14:46 that a rate hike is off the cards in FY '24.
14:52 OK, well, let's stick to policy and get in Tanvi Gupta Jain.
14:56 She joins in right now, as she did in the last policy as well.
15:00 Tanvi, it's a pleasure talking to you yet again.
15:02 Thank you for taking the time out.
15:04 What stood out for you?
15:06 I would say the policy was largely on expected lines.
15:10 Rates were kept unchanged at 6.5.
15:13 Growth forecast was kept unchanged.
15:15 We were highlighting there's a 30 basis point upside
15:18 to inflation.
15:19 And RBI went ahead and revised the forecast from 5.1 to 5.4.
15:25 But I think two things which stood out.
15:28 One, you can clearly see that MPC
15:31 remains vigilant on inflation.
15:33 I mean, very clearly, the RBI governor
15:35 reiterated that the commitment is
15:38 to align CPI inflation to the 4% level on a durable basis.
15:44 And if you look at, I know the entire market was worried
15:47 about vegetable prices leading to higher CPI inflation, which
15:50 in our forecast are also showing that the month of July
15:54 and August, my inflation will be trending towards
15:56 or in between 6% to 7%.
15:58 But I think one very strong statement, which
16:01 kind of RBI governor clearly highlighted,
16:04 that we do look through idiosyncratic shocks.
16:07 But if these shocks show signs of persistence,
16:10 we have to act.
16:12 So in case one of inflationary pressures
16:15 became more generalized, I think RBI
16:18 is kindly saying that my focus is inflation,
16:20 and I remain vigilant.
16:22 So I'm nowhere near dovish.
16:24 I know that I'm saying that whatever happens,
16:27 and I'm going to stay put.
16:29 So I think that was interesting.
16:30 The second interesting thing was definitely
16:32 on this incremental CRR.
16:34 We know the system liquidity is around $20-21 billion
16:38 before this measure, which was announced today.
16:43 And clearly, they have highlighted--
16:45 at least RBI governor clearly highlighted
16:47 that they will be able to absorb the surplus liquidity generated
16:52 by various factors to the tune of around $12 billion,
16:55 very similar to the number we came out with.
16:58 I think that is something which surprised the market more
17:01 than the rate this season today.
17:05 Tami, I would like to delve a little bit more
17:08 into the food inflation dynamics.
17:10 Like, for instance, the RBI now forecasts Q2 CPI inflation
17:16 at 6.2% compared to its previous forecast of 5.2%.
17:21 That's a sizable upgrade to the forecast, right?
17:25 So food inflation, there's a lot happening even
17:28 within each commodity.
17:30 What's your view?
17:31 Do you think there are greater risks of stickier food
17:35 inflation?
17:36 OK.
17:37 So what a very interesting analysis which we did,
17:40 we looked at--
17:40 we actually studied a month-on-month price momentum
17:43 across all vegetables, which come under the CPI vegetable
17:47 category over the past 10 years.
17:49 And you realize that seed per vegetables alone
17:52 has almost a 6% weight in overall CPI.
17:55 And when I look at the data, you will
17:57 see that almost all vegetable prices
17:59 showed this upward momentum in the month of June and July.
18:02 They peak out in July, August, and they actually
18:05 begin to decline significantly in the month of September
18:08 onwards.
18:09 Normally, we have seen that tomatoes,
18:11 which is the biggest culprit this time around--
18:13 cropping season for tomatoes is only 2 and 1/2 months.
18:16 So you will see that there is a clear seasonal pattern
18:19 between June and July.
18:21 Because this time, because of uneven monsoons,
18:23 we did see that the crop output got damaged.
18:26 My expectation is you will see the supply
18:29 hitting the market, and tomato prices
18:30 will begin to correct from the month of September onwards.
18:34 Again, if I look at the categories of vegetables
18:36 available within the broader CPI heading,
18:39 I realize that most of the vegetables
18:42 will show a moderation from the month of August.
18:45 Onion prices are something that could actually-- normally,
18:47 if I look at past 10-year data, they normally
18:49 end up surging in the upcoming months after the tomato prices.
18:53 This year, if El Nino actually strengthens pace
18:56 from September, which most of the weather agencies
18:59 are predicting, then what you will see--
19:01 that unseasonal rainfall, which you
19:03 have seen in the past few years, that every time
19:06 during the months of October and November,
19:08 you get unseasonal rainfall and vegetable price hike again
19:11 happens--
19:11 I think this time, you might be lucky that you may not
19:14 see that spike in vegetable prices, which
19:17 you are seeing right now.
19:19 So in that sense, yes, there is a very significant revision
19:22 in the September quarter inflation forecast.
19:25 And I think if the weather conditions remain in our favor,
19:29 you will see that correction happening very significantly
19:32 from the month of September onwards.
19:34 OK.
19:35 Well, let's get in Jayesh Mehta in this conversation as well.
19:38 Jayesh, great having you.
19:39 Thanks for taking the time out just talking
19:41 to Tanvi about her thoughts on what stood out in inflation.
19:45 Starting question to you, what is the standout feature for you
19:48 in the policy?
19:49 And a word on this whole conversation
19:52 that happened around the worst throw, and the rupee,
19:55 and the liquidity, and the fallout from that,
19:59 if any, if there is a sudden reversal.
20:01 Hi, thanks.
20:05 So I think maybe let me start the reverse way around, right?
20:10 On the worst throw, so while we may keep on saying that it's
20:13 been permitted to keep in India, and people are using that--
20:18 or not using that, they were silent on it.
20:21 But as also Deputy Governor Ravi Shankar said,
20:27 what makes you think that balance is lying in worst throw?
20:29 Because it's a trade surplus, right?
20:33 Which is anyway going out for expenses for our other imports
20:37 and stuff like that.
20:38 So from that perspective, that's one part of it.
20:41 So I would not worry too much on the worst throw.
20:45 Nor our guess, as market does think that they were buying
20:49 G-Sec and all that.
20:51 Our guess, our team's guess is not much
20:54 they have done in G-Sec.
20:55 So from that perspective, I would not really look at it.
20:59 And again, at the end of the day,
21:02 we don't have any bilateral with Russia.
21:04 So whether it's the rupee trade, or AUD trade, or yuan trade,
21:09 how does it matter?
21:10 It's ultimately not going to be foreign currency neutral,
21:14 right?
21:14 So from that perspective, I would kind of ignore that,
21:18 and see as and when it comes in.
21:21 As far as today's policy is concerned,
21:24 everything was as per the expectation,
21:27 except for the new CRR situation.
21:31 And I take this slightly differently, because--
21:35 and I think I'm, again, reading between the lines.
21:38 This is purely my interpretation.
21:41 That there was a challenge that banks are not
21:44 using 14-day repo.
21:46 RBI consciously, in the last four years or so,
21:49 moved to three years or so, moved to 14-days repo.
21:52 And they want to keep it that way,
21:54 rather than tinkering daily, and three days, and four days,
21:56 and five days.
21:58 I think there is also a behavioral situation, where
22:01 he also mentioned before saying this, that there was--
22:06 in 14 days, people don't put in money.
22:08 Rather, they would try to put money at SDS at quarter percent
22:11 lower.
22:13 It's purely behavioral, because--
22:15 and there are reasons for that behavioral thing.
22:17 Because in the past, there have been questions that,
22:21 while you're lending 14 days to RBI, why would you borrow?
22:23 Because in between, you might have a different situation,
22:26 and you might have to borrow.
22:27 So nobody wants to really take a call more than three,
22:30 four days.
22:30 And maybe there was no other alternative.
22:33 Otherwise, they are very clear that three, four days,
22:36 they don't want to bring it back again.
22:38 And maybe that's the reason they went for the CRR.
22:42 And again, it's temporary.
22:44 Again, this liquidity which came in because of the 2000 rupee
22:49 note was kind of not planned activity
22:53 in terms of the surpluses.
22:58 So that has to be sucked out.
22:59 And that's the right thing to do.
23:03 So Mr. Mehta, what do you expect will be the near short-term
23:07 impact of the measure?
23:10 Also, while short-term rates are expected
23:14 to remain slightly elevated following today's
23:17 announcements, is there any impact
23:19 we can expect on broader bond markets as well?
23:23 Not really.
23:24 I think it's just a first day reaction.
23:28 Yes, the only thing impact would be on the equity side,
23:31 on the bank equity pricing.
23:34 But I really don't see much impact
23:36 on liquidity or bond pricing.
23:37 Of course, short-end did move up a little bit.
23:41 But beyond that, I think it is just
23:43 a question of another three, four days
23:45 for it to settle back.
23:46 Well, Tanvi, can I get you in on the inflation piece once?
23:53 And that is the point that one, global rates higher for longer
23:59 noted by the Reserve Bank of India.
24:00 Their own statement suggests hikes or other cuts
24:03 are out of the window until FY24.
24:06 On the food inflation, they said that everything else
24:08 was aligned.
24:09 Food was where the shock was.
24:11 And we hope-- twice did Michael Patra
24:14 say that we hope that it passes through.
24:16 But we are also hitting a busy festive season
24:19 in circa couple of months.
24:21 What is your internal assessment?
24:23 Do we kind of peter down at some point of time?
24:26 Or there are jokers out in the play because of food,
24:29 because of China, and so on and so forth?
24:32 So a couple of things from the inflation perspective.
24:35 The way I will be watching out inflation going forward
24:37 and things which I will be monitoring.
24:39 Obviously, we need to take into account
24:41 while summer crop sowing has been fine so far.
24:43 It is largely flat.
24:44 Rice has picked up.
24:45 We are seeing that there is a lag in the pulses production.
24:49 Second, if El Nino actually strengthens pace--
24:52 and we know our winter crop is largely irrigated.
24:54 But what if you end up getting a very dry winter, which
24:57 can have an impact on wheat, where we don't have
24:59 enough buffer stock of wheat?
25:01 And the third, I would say, I mean,
25:03 we are in a pre-election year.
25:04 What if there is a pickup in populist spending ahead
25:07 of tied election calendar?
25:09 I mean, we have five states going for elections
25:11 in November, December.
25:12 We have parliamentary election next year.
25:15 So I think all these factors will have a bearing
25:19 on how inflation pans out, not only food,
25:22 but overall how inflation pans out.
25:24 I mean, we are lucky that poor inflation is actually
25:27 very reasonable and comfortable.
25:29 A lot has to do with even the global supply side bottlenecks,
25:33 which are these, which is actually helping in bringing
25:35 down poor inflation.
25:37 So right now, I would say most of the upside risk
25:39 in inflation, which has come up, say even that 30 basis
25:42 point, which you're seeing is purely on account of food.
25:45 When we looked at our inflation trajectory,
25:47 we have not really revised so much
25:49 on my core inflation numbers.
25:52 But I think, as I was pointing out,
25:54 any populist spending by the government closer to election,
25:57 that's a risk which we have to monitor very closely.
26:00 And what if we don't end up getting a very good wheat
26:03 output next year, especially in a year
26:06 when you have elections around the corner?
26:09 And plus, there are geopolitical uncertainties,
26:11 which is having an impact on global food prices.
26:14 So that is something I think, from an inflation point of view,
26:17 very important to monitor going forward.
26:18 - Sanvi, as a follow up to that, so I
26:26 would like to know what's your inflation
26:28 forecast for the figures coming up on Monday?
26:31 We've seen a fairly wide range, ranging from anywhere over 6%
26:35 to maybe a possibility that inflation figures for July
26:40 might actually exceed 7%.
26:42 - OK, so as of now, my forecast for July is 6 and 1/2.
26:49 And we do actually make our forecast
26:52 based on real-time data for whatever food segments,
26:55 vegetables, cereals, pulses.
26:58 So whatever other actual data, whichever
27:00 is available of the basket of food commodities
27:02 that we have already taken into account.
27:04 So it is coming somewhere around 6 and 1/2%.
27:07 For the month of August, my inflation number
27:09 will remain elevated.
27:11 But again, I will take the real-time actual numbers
27:13 into my calculation to see whether it is actually
27:16 going closer to 7 or the number is
27:18 going to be slightly somewhere between 6 and 1/2, 7.
27:21 But as of now, I'm still in the camp
27:22 that 6 and 1/2 looks like a much more reasonable number
27:25 for the month of July.
27:28 - OK, Jayesh, one final question.
27:30 I mean, for a lot of people, the ICR or the incremental CRR
27:33 was the key announcement per se in a policy which,
27:36 as Tanvi said, was largely on expected lines.
27:39 And I believe you would think so as well.
27:41 Would that be your assessment?
27:43 And is there anything else that stood out for you?
27:45 And also, a follow-up is there on what's
27:48 your assessment of whether the rupee stays
27:51 stable with the RBI as a first, so on and so forth?
27:54 Or do we see a bit of a slide because the dollar index,
27:58 after kind of weakening a little bit,
28:00 has again showed some signs of strength?
28:04 - No, except for ICRR, which people found it surprising.
28:10 But I take it differently.
28:12 I think it's just to maybe impress upon the behavioral.
28:16 So maybe once the behavioral changes,
28:18 we might not have to in future resort
28:20 to this kind of situation.
28:21 That's one.
28:22 In terms of currency, yeah, it's become very range-bound.
28:27 It looks like '83 will be defended.
28:31 So there is no question about it,
28:33 though we are very close to '83.
28:34 If it is broken, market expects that to go to '83, '60.
28:38 But as of right now, doesn't look like--
28:41 and he also did use the word, we have got the umbrella back.
28:46 And in what context he talked about the umbrella.
28:49 And he also clarified this.
28:51 I'm not talking about monsoon umbrella.
28:52 And in one of the previous speech,
28:55 they said that you have an umbrella to be used for any day.
28:58 And I think they will continue to defend,
29:02 unless you see some really major outflow, dollar strengthening,
29:07 DXY strengthening dramatically.
29:10 That's a very different situation.
29:11 But it doesn't look like from the--
29:15 particularly from our friends in equity markets
29:17 and other markets.
29:18 So it doesn't really look that way.
29:21 - OK.
29:22 Tanvi, Jayesh, thank you so much, both of you,
29:24 for taking the time out and giving us your quick assessments.
29:26 Really appreciate your time.
29:28 - Thanks, Sly.
29:28 - Thank you.
29:29 - Thank you.
29:29 And viewers, from Pallavi, myself,
29:31 and the team that put this broadcast together,
29:33 thanks so much for tuning in.
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