MPC meeting – Artifex.News https://artifexnews.net Stay Connected. Stay Informed. Fri, 07 Jun 2024 04:47:32 +0000 en-US hourly 1 https://wordpress.org/?v=6.6.1 https://artifexnews.net/wp-content/uploads/2023/08/cropped-Artifex-Round-32x32.png MPC meeting – Artifex.News https://artifexnews.net 32 32 RBI MPC Meeting: Repo rate unchanged at 6.5% for 8th time in a row https://artifexnews.net/article68262056-ece/ Fri, 07 Jun 2024 04:47:32 +0000 https://artifexnews.net/article68262056-ece/ Read More “RBI MPC Meeting: Repo rate unchanged at 6.5% for 8th time in a row” »

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RBI Governor Shaktikanta Das on June 7, 2024, said the Monetary Policy Committee has decided to keep the repo rate unchanged at 6.5%. File
| Photo Credit: ANI

The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) has decided to keep the repo rate unchanged at 6.5%. The decision, taken at the MPC’s meeting on Friday, marks the eighth time in a row that the policy rate has been put on hold to keep the focus on battling high inflation.

The MPC has revised its GDP growth forecast upwards from the earlier 7% estimate to 7.2% for the financial year 2024-2025. It has also decided to remain focused on withdrawal of accommodation to ensure that inflation does not accelerate, while supporting growth.

“These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2% while supporting growth,” Reserve Bank of India (RBI) governor Shaktikanta Das said after the meeting. 

Divided MPC

Mr. Das, along with MPC members Shashanka Bhide, Rajiv Ranjan, and Michael Debabrata Patra voted to keep the policy repo rate unchanged at 6.5% and to remain focused on the withdrawal of accommodation, while their colleagues Ashima Goyal and Jayanth R. Varma voted to reduce the policy repo rate by 25 basis points and for a change in stance to neutral. 

“There were signs of a more divided policy committee, with one additional member voting for a softening in stance as well as policy direction. The majority retained their cautious stance to guide inflation towards the 4% target on a durable basis, despite recent signs of disinflation,” said Radhika Rao, Executive Director and Senior Economist, DBS Bank, commenting on the decision.

Higher growth forecast

According to the MPC, high frequency indicators of domestic activity are showing resilience in 2024-25. The south-west monsoon is expected to be above normal, which augurs well for agriculture and rural demand, but headwinds from geopolitical tensions, volatility in international commodity prices, and geoeconomic fragmentation pose risks to the outlook. 

Taking various factors into consideration, real GDP growth for 2024-25 was projected at 7.2% as compared with the earlier projection of 7%, with the first quarter (Q1) growth estimate at 7.3%; Q2 at 7.2%; Q3 at 7.3%; and Q4 at 7.2%. The risks are evenly balanced.

Elevated food inflation

Emphasising that inflation has seen sequential moderation since February 2024, albeit in a narrow range from 5.1% in February to 4.8% in April 2024, the RBI Governor said that food inflation, however, remains elevated due to persistence of inflation pressures in vegetables, pulses, cereals, and spices. 

“Looking ahead, overlapping shocks engendered by rising incidence of adverse climate events impart considerable uncertainty to the food inflation trajectory,” he said, while announcing the MPC’s decisions. He added that volatility in crude oil prices and financial markets, along with the firming up of non-energy commodity prices, pose upside risks to inflation. 

Taking various factors into account, CPI inflation for 2024-25 is projected at 4.5%, with Q1 at 4.9%; Q2 at 3.8%; Q3 at 4.6%; and Q4 at 4.5%. The risks are evenly balanced.

Mr. Das emphasised that the path of disinflation has been interrupted by volatile and elevated food inflation due to adverse weather events. “Inflation is expected to temporarily fall below the target during Q2:2024-25 due to favourable base effect, before reversing subsequently. The MPC will remain resolute in its commitment to aligning inflation to the 4% target on a durable basis,” he said. 

The MPC reiterated the need to continue with the disinflationary stance, until a durable alignment of the headline CPI inflation with the target is achieved. 



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India Poised To Be Growth Engine Of World: RBI Governors Top Quotes https://artifexnews.net/india-poised-to-be-growth-engine-of-world-rbi-governors-top-quotes-4455109rand29/ Fri, 06 Oct 2023 05:23:21 +0000 https://artifexnews.net/india-poised-to-be-growth-engine-of-world-rbi-governors-top-quotes-4455109rand29/ Read More “India Poised To Be Growth Engine Of World: RBI Governors Top Quotes” »

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The Reserve Bank of India has decided to retain the policy rate for the fourth time in a row, RBI Governor Shaktikanta Das said today, adding that the central bank is closely monitoring inflation. The governor said the Monetary Policy Committee (MPC)

Here are the top quotes from the RBI governor’s address:

  1. “India is poised to become new growth engine of world. Domestic economy exhibits resilience on back of strong demand.”

  2. “RBI retains GDP growth forecast for current fiscal at 6.5 pc with risks evenly balanced.”

  3. “Indian forex reserves stood at $586.9 billion as on September 29.”

  4. “Inflation is likely to ease in September. Central bank forecasts retail inflation at 5.4 pc for 2023-24. Retail inflation to moderate to 5.2 per cent in next year from the current level of 6.8 per cent. Our inflation target is 4 per cent, not 2 to 6 per cent; we remain vigilant to evolving inflation target,”

  5. “Indian banking system continues to be resilient on back of improved asset quality.”

  6. “RBI has decided to double the gold loan under bullet payment scheme to Rs 4 lakh for Urban Cooperative Banks”



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RBI Keeps Key Lending Rate Unchanged At 6.5% For 4th Consecutive Time, Says Governor Shaktikanta Das https://artifexnews.net/reserve-bank-of-india-keeps-key-lending-rate-unchanged-at-6-5-for-fourth-consecutive-time-4454925rand29/ Fri, 06 Oct 2023 04:35:12 +0000 https://artifexnews.net/reserve-bank-of-india-keeps-key-lending-rate-unchanged-at-6-5-for-fourth-consecutive-time-4454925rand29/ Read More “RBI Keeps Key Lending Rate Unchanged At 6.5% For 4th Consecutive Time, Says Governor Shaktikanta Das” »

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Mumbai:

The Reserve Bank of India (RBI) today decided to keep its key lending rate unchanged at 6.5% for the fourth consecutive time. The decision was taken unanimously at the central bank’s Monetary Policy Committee (MPC) meeting, said RBI Governor Shaktikanta Das.

This means the loan interest rates too are likely to remain unchanged.

The overall inflation outlook is clouded by uncertainties, said the RBI Governor, adding that the banking system remains resilient.

“The overall inflation outlook is clouded by uncertainties from the fall in Kharif sowing for certain key crops like pulses and oil seeds, lower reservoir levels and volatility in global food and energy prices,” said Mr Das.

The RBI expects retail inflation to be 5.4% for the current financial year and reduce to 5.2% in the first quarter of the next fiscal.



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