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Post Monetary Policy: Where to Invest
May 3, 2013

Our Take on Monetary Policy Statement for the year 2013-14.


Author : Dr.Renu Pothen



Update Monetary Policy_Sept2012

Update from Research Desk on monetary policy statement for 2013-14

Off late, North Block and Mint Road have been giving contradictory views regarding the health of our economy. Our Finance Minister, who has been on a world tour since he resumed office, has been convincing foreign investors that everything is fine in India. On the other hand, our Reserve Bank of India (RBI) governor, tends to supplement every rate cut with a hawkish message stating that there is limited room for further easing in the monetary stance as the macroeconomic scenario is not in good stead.

In the Monetary Policy Statement 2013-14 announced today, the RBI reduced the repo rate by 25 basis points to 7.25% which was as per market expectations. However, a glance through the policy document reveals that the central bank has a pessimistic outlook as far as the future growth potential of the economy is concerned. The governor has been making it very clear to the government that it will have to pull up its socks and start taking measures like removing the supply bottlenecks, setting up public investments and also continue with the fiscal consolidation steps.

In this scenario, we continue to maintain our positive stance on short-term funds for those investors with a 6-month to 1-year time horizon. Our recommended funds in this space are PineBridge India Short Term Fund and Templeton India Short-Term Income Plan.Investors who have a time horizon of more than a year can consider income funds such as Templeton India Income Builder Account and Canara Robeco Income Fund.

Dr. Renu Pothen
Research Head-Fundsupermart.com India


Disclaimer: iFAST and/or its content and research team’s licensed representatives may own or have positions in the mutual funds of any of the Asset Management Company mentioned or referred to in the article, and may from time to time add or dispose of, or be materially interested in any such. This article is not to be construed as an offer or solicitation for the subscription, purchase or sale of any mutual fund. No investment decision should be taken without first viewing a mutual fund's scheme information document including statement of additional information. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Investors should seek for professional investment, tax, and legal advice before making an investment or any other decision. Past performance and any forecast is not necessarily indicative of the future or likely performance of the mutual fund. The value of mutual funds and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. Please read our disclaimer on the website.Please read our disclaimer in the website.



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