SBI's Bhattacharya Says India's Low Rates to Continue

The transcript discusses the impact of demonetization on liquidity and interest rates, noting that while liquidity initially increased, it is now flowing out. The Reserve Bank of India has shifted its stance to neutral, and lending rates are expected to remain stable despite potential increases in the cost of funds. Inflation is projected to stay below 4%, and there is no immediate concern for it to rise. The RBI is cautious about energy costs and global economic factors like US interest rates and Brexit. Concerns about protectionism under the Trump administration are also addressed, emphasizing the importance of openness and capital flow for economic growth.

What was one of the effects of demonetization on the banking sector?

• Increase in low-cost deposits

• Decrease in liquidity

• Increase in high-cost deposits

• Rise in lending rates

What is the Reserve Bank of India's stance on lending rates in the near future?

• They will decrease sharply

• They will significantly increase

• They will fluctuate unpredictably

• They will remain stable

What is one concern the RBI has regarding inflation?

• Rising energy costs

• Decreasing food prices

• Stable housing market

• Increasing foreign investments

How might US protectionist policies affect international workers?

• Increase in job opportunities

• Increase in wages

• No change in job opportunities

• Decrease in job opportunities

Why is economic openness important according to the transcript?

• It stabilizes currency exchange rates

• It increases domestic production

• It attracts international talent and capital

• It reduces inflation