Sat. Oct 1st, 2022
rbi reporate

NEW DELHI, INDIA: At the end of the monetary policy committee’s three-day meeting on June 8, the Reserve Bank of India (RBI) hiked the repo rate by 50 basis points, the second rise in five weeks. The move came as little surprise, as many polls, including a Moneycontrol poll of 15 analysts, predicted a 40 basis point increase. Previously, the monetary policy committee (MPC) met unexpectedly in early May and decided unanimously for a 40 basis point repo rate hike in expectation of a significant increase in April inflation. The repo rate is the rate at which the RBI loans banks short-term money.

The repo rate is the rate at which the RBI loans banks short-term money.
According to the RBI’s most recent prediction, published in April, headline retail inflation would average 6.3 percent in April-June, 5.8 percent in July-September, 5.4 percent in October-December, and 5.1 percent in January-March 2023.

The following are the top ten highlights from RBI Governor Shaktikanta Das’ speech:

  • The rates for the Standing Deposit Facility and the Marginal Standing Facility were increased by 50 basis points. The rate on the Standing Deposit Facility is now 4.65 percent, while the rate on the Marginal Standing Facility is now 5.15 percent.
  • The MPC agreed unanimously to keep the focus on withdrawing stimulus in order to keep inflation within target in the future.
  • The GDP growth projection for FY23 has been maintained at 7.2 percent. For April-June, GDP growth is expected to be 16.2 percent. GDP growth is expected to reach 6.2 percent from July to September. GDP growth is expected to reach 4.1 percent from October to December. GDP growth of 4.0 percent is projected for January-March 2023.
  • RBI Governor Shaktikanta Das upped the CPI inflation projection for FY23 from 5.7 percent to 6.7 percent. The RBI’s inflation projection is based on a regular monsoon and a crude basket price of $105 per barrel.
  • As pandemic-related actions are normalised, the RBI will maintain enough liquidity in the banking system.
  • The RBI is keeping a close eye on the market for government securities. We will take the appropriate procedures as needed.
  • India’s foreign exchange reserves remained at $601.1 billion as of June 3.
  • CPI inflation projection for FY23 increased to 6.7 percent from 5.7 percent, according to RBI Governor Shaktikanta Das. The RBI’s inflation projection is based on a regular monsoon and a crude basket price of $105 per barrel.
  • As pandemic-related actions are normalised, the RBI will maintain enough liquidity in the banking system.
  • The RBI is keeping a close eye on the market for government securities. We will take the required actions when they become available.

By adele rose

Adele Rose is the senior editor and employee of WGBS Pvt Ltd Digital wing.

Leave a Reply

Your email address will not be published.