Friday, July 4, 2008

Has Indian growth story gone shaky? Plunging stock - high inflation - weakening rupee - now, bank loans for the first quarter confirms the slowdown -

RBI policy tightening takes a toll on credit:

According to the latest data released by RBI on Thursday, total non-food credit extended by commercial banks amounted to Rs 23,42,973 crore as on June 20 — the last reporting Friday of the quarter. This represents an absolute growth of Rs 38,879 crore for the quarter. And it seems to allay fears of a slowdown in credit offtake.

In fact, bankers are not seeing a significant pick-up in credit demand and a significant chunk is believed to be from oil companies to meet their working capital demand, as crude prices are touching new highs.

Also, demand from home-loan seekers, too, is low at such times. Besides, high real estate prices still high in most pockets and northward interest rates have further affected demand for home loans.

RBI policy tightening takes a toll on credit

Related Story:

Banks encourage prepayment on home loans, waive penalty

1 comment:

  1. Rising interest rates and a falling demand may dent the realty market in India. However, the long-term prospects for the sector continue to be good, feels the industry. There are around 21 India-dedicated real estate funds that are raising money in the international market. In the next nine months, nearly $7 billion will be entering the country through various India-dedicated funds. While long-term players are looking at India, short-term players based in the US and Europe, such as the hedge funds and private equity players, are more interested in their local markets.For more view-