Indian banks on Friday indicated that borrowers could be given relief by way of interest rate cut subject to inflation coming down and their getting further relief from the apex bank.
"More relaxations are warranted going forward, given that this is the busy season," said Yes Bank managing director and CEO Rana Kapoor.
However, RBI Governor D Subbarao, after unveiling the mid- term review of the credit policy said RBI has given signals on interest rates and it was for the banks to cut rates.
"We signal interest rates. It is for the banks to take a decision on what their interest rates should be," Subbarao said while responding to a query on whether interest rates would soften.
While Kapoor expects lending and deposit rates to remain unchanged in the near-term, the Punjab National Bank executive director J M Garg said, interest rates would come down with further easing of inflation and some more policy action from RBI side.
Softening of rates is a possibility but not immediately, Garg said.
RBI on Monday slashed short-term lending (repo) rate by 100 basis points to 8 per cent signalling softening of interest rates.
According to the UCO Bank Chairman S K Goel, "There is possibility of interest rates heading downward. PLR (Prime Lending Rate)