Liquidity scenario is on an improving trend for the banking sector though it has not fully revived, said a top official of Axis Bank. According to the official, the improving stature of liquidity is an indicative that no further intervention is likely from the part of the banking regulator, RBI in the monetary policy review on September 16.
"It's not as if credit is picking up with huge momentum. Liquidity is better but still not in excess. I think it's a well-managed liquidity situation. So, we actually don't see a lot of case for much intervention at this point in time," Axis Bank MD and CEO Shikha Sharma said.
"But I am sure regulators are going to watch statistics regularly and closer to the date they can take a call about what needs to be done. At this point in time, I think the directions are not clear," she added.
Speaking on the issue whether the bank is harboring any intentions to raise base rates, Sharma said that it is a difficult environment make a sure shot decision in this regard.
"So we are watching the markets on daily basis. The liquidity situation and the credit situation is what's going to determine what happens to interest rates. We will keep watching them...," she said.