The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) on Friday kept the repo rate unchanged at 4% and the reverse repo rate at 3.35%, even during the second wave of coronavirus disease (Covid-19) After the wave, the economy showed signs of recovery.
The Governor of the Reserve Bank of India, Shaktikanta Das, announced the October bimonthly monetary policy statement at 10 am on this day, saying: “As long as it is necessary to restore and maintain growth and mitigate the impact of the Covid-19 pandemic , While ensuring inflation, the monetary policy stance will remain accommodative. Stay within the target range.”
This is the eighth consecutive time that MPC, led by Shaktikanta Das, Governor of the Reserve Bank of India, has maintained the status quo. The Reserve Bank of India last revised its policy repo rate or short-term loan rate on May 22, 2020, in a non-policy cycle to boost demand by reducing interest rates to historical lows. Last Friday, the Reserve Bank of India also maintained its forecast of a real GDP growth rate of 9.5% for the 2021-22 fiscal year.
This includes 7.9% in the second quarter of the 2021-22 fiscal year, 6.8% in the third quarter, and 6.1% in the fourth quarter. The real GDP growth rate in the first quarter of fiscal year 2022-23 is expected to be 17.2%. The Governor of the Reserve Bank of India said at a press conference on Friday: “We have decided to keep the policy repo rate unchanged at 4%. The reverse repo rate remains at 3.35%.” He said that India’s economic recovery is gaining traction, adding that its situation is better than the prospects of the last MPC meeting.
“The growth momentum is strengthening and the inflation trajectory is more favorable than expected,” said Shaktikanta Das, Governor of the Reserve Bank of India. “Because the economic fundamentals of our economy are resilient, we hope to move towards a normal period.” The consumer price index (CPI) inflation rate for fiscal year 2022 is expected to be 5.3%, while the CPI inflation rate for the first quarter of fiscal year 2022-23 is expected to be 5.2%. With rising fuel prices, the retail inflation rate in August was 5.3%.
News Source : Hindustan Times
