New Delhi: The six-member Monetary Policy Committee (MPC) of the Reserve Bank of India left key rates unchanged in its bi-monthly policy review on Friday. Announcing its monetary policy changes after a three-day meeting, Governor Shaktikanta Das said the MPC unanimously voted to maintain status quo and keep the repo rate unchanged.
The repo rate remained unchanged at 4 per cent and the reverse repo rate remained unchanged at 3.35 per cent.
“The monetary policy stance remains accommodative as long as inflation remains within the target to revive and sustain growth and mitigate the impact of the COVID19 pandemic,” Das said. RBI left interest rates unchanged despite rising inflationary pressures and depreciation of rupee.
The recovery of the Indian economy is gaining momentum; It is in better condition than the last MPC meeting. Strengthening growth impulses, inflation trajectory favorable from anticipated; The Governor said that our economy is expected to move towards normal times due to the resilience of the economic infrastructure.
The real GDP growth forecast for the fiscal year 2021-22 has been retained at 9.5 per cent. This includes 7.9 per cent in Q2, 6.8 per cent in Q3 and 6.1 per cent in Q4 of 2021-22. The real GDP growth for the first quarter of the financial year 2022-23 is estimated at 17.2 per cent.
CPI inflation for FY22 is estimated at 5.3 per cent. Das said the CPI inflation for the first quarter of FY 2022-23 is estimated at 5.2 per cent.
Retail inflation eased marginally to a fourth-month low of 5.3 per cent in August, well within the RBI’s comfort zone, while WPI-based inflation rose to 11.39 per cent in August, driven by costly manufactured goods. The reason was
Given the accommodative monetary stance, the central bank wants to support a delicate economic recovery. The policy repo rate or short term lending rate currently stands at 4 per cent and the reverse repo rate at 3.35 per cent. The benchmark repo rate is the rate at which the central bank lends short-term money to banks.
Since the outbreak of the pandemic in March 2020, the RBI has cut repo rates by 4 per cent through two rate cuts of 75 bps in March 2020 and 40 bps in May 2020. Since then, RBI has not cut interest. Further rates.
The central bank balances on the back of boosting consumer sentiment and confidence, with a gradual improvement in domestic economic conditions and an increase in the pace of vaccination.
Rating agency Moody’s had downgraded the sovereign credit rating outlook from negative to stable, citing improvement in the financial sector and a faster than expected economic recovery.
(with inputs from ANI)