Chanda Kochar, Deputy MD of ICICI Bank said that it would be premature to assume that domestic rates will go down. Indecisiveness in the financial sector will lead to liquidity coming into India. It would be too early to comment whether RBI will cut rates on back of inflationary concerns, she said.

Rupee appreciation will continue to be led by FII inflows. Rupee appreciation would hurt exporters and the Fed cut will lighten US slowdown concerns helping demand for exports. Kochar believs that the spreads will tighten due to foreign currency costs. Foreign currency spreads will tighten and this would benefit domestic industry.

They don't expect interest rates to rise any further. Interest rate increases have impacted momentum of growth rates. Mortgage lending has slowed down but corporate lending has grown considerably, Kochar mentioned

On the prospects of ICICI Bank reducing rates, Kochar said that they would not change rates on basis of credit growth. Interest rates stability is positive for credit growth rate. Credit growth is unlikely to drop on given stable rates.