New Delhi, May 8

Interest rates are likely to remain stable in the near term and liquidity in the system is quite good, according to Mr K.V. Kamath, President, Confederation of Indian Industry (CII).

Mr Kamath, who is also CEO of the country’s largest private lender ICICI Bank, said on Thursday that the market was yet to judge which way interest rates will move. In the second fortnight of April 2008, the Reserve Bank of India had announced cash reserve ratio hike of 75 basis points to mop up Rs 27,000 crore from the system.

“Liquidity is good in the system. As long as liquidity is good, market will determine what the rate is. At this point of time, I do not think the market has judged which way interest is going to go. Bankers and market players still need signals as to where the true level is. At this point of time, I see no change (interest rates)”, he told reporters on the sidelines of a CII event here on Thursday.

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