RBI’s Monetary Policy Revealed; GDP Growth Rate at 9.5%, Inflation Rises to 5.7%
- RBI governor announces the monetary policy today
- Inflation estimate for FY22 is rises to 5.7 per cent from 5.1 per cent
- Monetary Policy Committee unanimously voted to maintain repo rates at 4 percent and the reverse repo rate at 3.35 per cent
New Delhi: Governor of Reserve bank of India (RBI), Shaktikanta Das announced the monetary policy today after the 6-member Monetary Policy Committee (MPC) reviewed the economy for the last quarter. While revealing the monetary policy, the governor declared that India is in a much better position than June 2021.
“There’s a need to remain vigilant on the possibility of a third COVID wave”, said the governor.
India’s economy is at a nascent stage of recovery from the deadly second wave of the COVID-19 pandemic. Having said that, RBI prioritizes growth and maintains financial stability as far as necessary. The Central Bank retained the Gross Domestic Product (GDP) growth rate for FY22 at 9.5 percent.
Consumer Price Index (CPI) inflation estimate for Financial Year (FY) 2022 is raised to 5.7 per cent from 5.1 per cent. While maintaining the balance between growth and inflation dynamics, the bank has raised GDP growth forecast for quarter 1 of FY22 but lowered the estimates of the remaining three quarters.
The RBI’s Monetary Policy Committee unanimously voted to maintain repo rates at 4 percent and the reverse repo rate at 3.35 per cent. Governor Shaktikanta Das pointed out that the underlying conditions around aggregate demand in the market are weak.
This is the third bi-monthly monetary policy review for the FY 2021-22. Among all the countries worldwide, India witnessed the largest drop in the growth projections made by the International Monetary Fund (IMF). However, the global economic growth rate remains at 6 per cent.