Highlights of RBI monetary policy
Mumbai, Aug 5: Following are the highlights of the RBI’s fourth monetary policy review of fiscal year 2022-23 announced by Governor Shaktikanta Das:
- Key short-term lending rate (repo) raised by 50 basis points (bps) to 5.4 per cent; third consecutive hike
In all, 140 bps hike in repo since May 2022 to check inflation
GDP growth projection for 2022-23 retained at 7.2 per cent (pc).
GDP growth projection: Q1 at 16.2 pc; Q2 at 6.2 pc; Q3 at 4.1 pc; and Q4 at 4 pc
Real GDP growth for Q1:2023-24 projected at 6.7 per cent
Domestic economic activity exhibiting signs of broadening
Retail inflation projection too retained at 6.7 pc for 2022-23
Inflation projection: Q2 at 7.1 pc; Q3 at 6.4 pc; and Q4 at 5.8 pc; Q1:2023-24 at 5 pc
India witnessed large portfolio outflows of USD 13.3 billion in FY23 up to August 3
Financial sector well capitalised and sound
India’s foreign exchange reserves provide insurance against global spillovers
Monetary Policy Committee decides to remain focused on withdrawal of accommodative stance to check inflation
Depreciation of rupee more on account of appreciation of US dollar rather than weakness in macroeconomic fundamentals of the Indian economy
RBI to remain watchful and focused on maintaining stability of rupee
Rupee depreciated by 4.7 pc against US dollar this fiscal year till August 4
India’s foreign exchange reserves remain fourth largest globally
Mechanism to be activated to allow NRIs to use Bharat Bill Payment System for payments of utility and education on behalf of their families in India
Next meeting of rate-setting panel scheduled for September 28-30, 2022.
