Today i.e. on April 8, Reserve Bank of India (RBI) Governor Shaktikanta Das announced the decisions of the Bi-monthly Monetary Policy (RBI MPC). Amid rising inflation, there are many challenges before the RBI. For the 11th time in a row, the Reserve Bank of India did not change the policy rates.
The Reserve Bank of India once again maintained the status quo on central bank policy rates. The repo rate is fixed at 4 per cent. The rate at which the central bank gives loans to other banks is called the repo rate. The increase in the repo rate increases the EMI burden on the customers.
The central bank also did not make any changes in the Reverse Repo Rate. It remains unchanged at 3.35 per cent. Along with this, Marginal Standing Facility (MSF) and Bank Rate is also stable at 4.25 per cent. Under the reverse repo rate, banks get interest on giving their money to the RBI.
RBI has lowered its Gross Domestic Product (GDP) estimate for the financial year 2022-23. The central bank said that in the current financial year it may remain at 7.2 per cent. It may be 16.2 per cent in the first quarter, 6.2 per cent in the second quarter, 4.1 per cent for the third quarter and 4 per cent in the fourth quarter. The central bank estimated the growth rate assuming that the price of crude oil would remain at $ 100 per barrel.
RBI Governor Shaktikanta Das said that the economy is facing new and very big challenges. The Reserve Bank is fully prepared to 'rescue' the economy. Das said that the economy is in a satisfactory position due to large foreign exchange reserves.
Inflation is likely to rise to 5.7 per cent in the current financial year. Earlier it was estimated to be at the level of 4.5 per cent. The consumer price index inflation (CPI) for April-June is estimated at 6.3 per cent. It may be 5 per cent in the second quarter, 5.4 per cent in the third quarter and 5.1 per cent in the fourth quarter. Good production of rabi crops may support the demand in rural areas.
RBI says that the Indian economy is slowly recovering from the slowdown caused by the pandemic. Globally, crude oil prices remain elevated. Because of this, inflation may increase. Edible oil prices will remain high in the coming times. Governor Das said that the Russia-Ukraine war could slow down the economic revival. Das said the Reserve Bank will ensure adequate liquidity in the system.
