RBI Monetary Policy: GDP Growth, Repo Rate, Reverse Repo Rate Remain Unchanged | Key Announcements Here
RBI Monetary Policy Today: RBI continues to have 'Accommodative' policy stance with five MPC members voting for it as the threat of new Covid variant Omicron looms large.
New Delhi: The Reserve Bank of India (RBI) today kept Repo Rate and Reverse Repo Rate unchanged at 4 per cent and 3.35 per cent respectively. The RBI Governor Shaktikanta Das confirmed that the rates would remain unchanged while announcing the Monetary Policy Committee's (MPC) decision. An unchanged repo rate means there would status quo as far as banks' lending rates to a consumer is concerned. The Gross domestic product (GDP) growth projection for the ongoing Financial Year 2021-2022 has been retained at 9.5 per cent, the RBI Governor said. RBI continues to have 'Accommodative' policy stance with five MPC members voting for it as the threat of new Covid variant Omicron looms large.
RBI Monetary Policy Today Highlights
- MPC has decided to keep benchmark repurchase (repo) rate at 4 per cent, Das said while announcing the bi-monthly monetary policy review.
- Consequently, the reverse repo rate will continue to earn 3.35 per cent for banks for their deposits kept with RBI.
- Das said MPC voted unanimously for keeping interest rate unchanged and decided to continue with its accommodative stance as long as necessary to support growth and keep inflation within the target.
- RBI retained its growth projection at 9.5 per cent for the current fiscal despite concerns over Omicron.
- Das also said the headline inflation would peak in the fourth quarter of the current fiscal.
- The inflation projection has been retained at 5.3 per cent for the current financial year.
- Retail inflation rose to 4.48 per cent in October from 4.35 per cent in September, mainly due to higher fuel and edible oil prices.
- MPC has been given the mandate to maintain annual inflation at 4 per cent until March 31, 2026, with an upper tolerance of 6 per cent and a lower tolerance of 2 per cent.
- All members of the MPC are Dr. Shashanka Bhide, Dr. Ashima Goyal, Professor Jayanth R. Varma, Dr. Mridul K. Saggar, Dr. Michael Debabrata Patra and Governor Shaktikanta Das.
This is the ninth time in a row that the MPC headed by RBI Governor Shaktikanta Das has maintained the status quo. RBI had last revised its policy repo rate or the short-term lending rate on May 22, 2020 in an off-policy cycle to perk up demand by cutting the interest rate to a historic low, as per a PTI report.
Meanwhile, Fitch Ratings on Wednesday cut India's economic growth forecast to 8.4 per cent for the current fiscal year ending March 31, 2022, but raised GDP growth projection for the next financial year to 10.3 per cent. Fitch had in October forecast a GDP growth of 8.7 per cent in 2021-22 (April 2021 to March 2022) fiscal and 10 per cent in FY23.
Fitch Ratings is an American credit rating agency. It is considered as one of the "Big Three credit rating agencies" in the world. The other big two credit rating agencies are Moody's and Standard & Poor's.
Published Date:December 8, 2021 10:31 AM IST
Updated Date:December 8, 2021 12:31 PM IST