Photo: ReutersIf there are multiple ways to skin a cat, then there are as many ways to read a central bank’s policy document. Interpreting central bank speak is an acquired skill. A few days before announcing the monetary policy, the RBI afforded banks some latitude by softening the blow of rising bond yields. RBI’s February 2015 guidelines identified credit-to-GDP gap–explained as difference between credit-to-GDP ratio and the long-term trend value of the same ratio—as the main indicator (in conjunction with some secondary parameters) for activating the CCCB framework. But the beef is elsewhere: the monetary policy committee’s statement and the accompanying monetary policy report seem quite bullish on credit growth.

Source: Mint April 15, 2018 20:48 UTC