S&P, Moody's are like docs with two views: KC Chakrabarty

On investor reaction to S&P move

Usually, if rating is down, an investor begins to avoid it. But many times, the investor doesn’t behave like that. Loss-making banks also witnesses a rise in their share price. Investor pay money, how will we not able to predict how to behave? By behaving rationally, a good investor would have discounted the downgrade factor. I have already discounted it. You can also say that the market has already discounted the event; my cost has already gone up. It may not further go up.

View on Moody's contrasting ratings

You go to ten doctors and get ten different opinions. You go to ten astrologer and get ten different opinions. The fellow who is getting the opinion may ask the doctor to give an opinion about the other doctor. I am not a rating agency. Ten people are giving 10 different opinions.

On being an affected party

I am not a patient. Our country has still not gone for sovereign borrowing. Some of the banks might have been downgraded, but I am not a patient.

On rating

It has nothing to do with the rating. Please understand that our currency intervention is depending on volatility in the market and not on ratings. If there is volatility and if there is a need to intervene, the RBI will intervene. Do you believe that there is no pressure on the government to contain the fiscal deficit? There is pressure. The government is not able act as there are many compulsions. They maybe trying to do it, but there is pressure. In fact in the Budget, the FM had talked about containing the fiscal deficit.