The nation’s biggest lender State Bank of India wants to nearly double its credit growth rate to 10% in the year started April 1, but is willing to miss the goal. Corporate willingness for new investments is low, according to the Centre for Monitoring Indian Economy Pvt., with capital expenditure declining. While companies have posted bumper profits mostly on the back of widespread cost cutting, most have used the extra funds generated to pay down bank loans. What Bloomberg Economics Says...“A further slump in credit growth means that the RBI is likely to allow some more time for credit recovery to take shape before its begins to unwind its stimulus measures." -- Abhishek Gupta, India economistConsumers too are repairing their finances, which bodes ill for overall demand for goods and services as well as retail loans, and in turn economic growth.

Source: Mint July 08, 2021 21:11 UTC