New Delhi: Reserve Bank of India (RBI) keeps the repo rate unchanged at 4 per cent, reverse repo rate also remains unchanged at 3.35 per cent. The MPC voted 5:1 unanimously to maintain an ‘accommodative’ stance. Further, marginal standing facility has also been left unchanged at 4.25 per cent.
The growth forecast for real GDP has been retained at 9.5 per cent.
Retail inflation is estimated at 5.3 per cent. FY22.
However, the central bank has revised down its Q3FY22 GDP growth to 6.6 per cent from 6.8 per cent earlier, and cut Q4FY22 GDP to 6 per cent from 6.1 per cent. RBI cuts Q4FY22 GDP to 6 per cent from 6.1 per cent earlier; And the FY22 CPI inflation target has been maintained at 5.3 per cent. Consumption demand is improving and rural demand is showing resilience. The recovery in the Indian economy is gaining momentum. Government consumption has increased since October 2021. The recent tax cuts on petrol and diesel should help increase investment in the private sector.
From January 2022, liquidity adjustment will be mainly through variable reverser repo. auction. CPI inflation will peak in the fourth quarter and moderate thereafter. RBI has proposed to return to the normal regime under the Marginal Standing Facility (MSF) window. The RBI remains committed to a liberal stance to broaden the growth impulses.
FY22 CPI inflation target maintained at 5.3 per cent. The October-December CPI inflation target has been revised upwards to 5.1 per cent from 4.5 per cent, while the January-March CPI inflation forecast has been revised upwards to 5.7 per cent from 5.8 per cent.
Banks do this. Prior approval of Reserve Bank of India is not required for infusion of capital in its branches or overseas offices.
Review of prudential norms of investment portfolio. A discussion paper will be placed on RBI’s site shortly.
RBI will release a discussion paper on Fees on Digital Payments in India on its holistic approach.
To further deepen the UPI system in India, RBI has proposed three more measures to launch UPI-based payment products for feature phone users.
The central bank will continue to manage liquidity to maintain financial stability.
RBI will endeavor to broaden the growth impulses, encourage credit flow to productive sectors. The Indian economy grew by 20.1 percent in the first quarter of the current financial year and 8.4 percent in the second. Production is expected to remain strong in the third quarter as the economy resumes. Concerns over supply disruptions, higher commodity prices and now the newer COVID version — Omron — have, however, added to the uncertainty in the outlook.
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