Reserve Bank of India (RBI) on Thursday kept the repo rate and the reverse repo rate unchanged in its first monetary policy review after Union Budget 2022. The current repo rate in 2021 is at 4% and the reverse repo rate is at 3.35%. The pandemic holds the world economy hostage once again, Governor Shaktikanta Das made the said while announcing the review.
RBI also kept the benchmark lending rate unchanged the 10th time in a row at 4% and informed that Inflation will peak in the current quarter with a tolerance band, moderating in the second half of next fiscal.
Real GDP growth for the next financial year is projected at 7.8% and RBI would continue to insulate the domestic economy from global spillovers said, Governor Shaktikanta Das.
Giving a lowdown about the pandemic situation, Das said the universal focus amid the pandemic is shifting to a targeted containment strategy, universal vaccination and booster doses.
Some loss of momentum in economic activity has been reported in some sectors including sales of automobiles, two-wheelers etc, the Governor said adding that the renewed surge of global crude oil price needs to the closely monitored.
He further said that India is charting a different course of recovery than the rest of the world and is going to be the fastest-growing economy.
“We have made effort to limit the disruption to economic activity. While CPI edged higher, it is along expected lines. Core inflation remains elevated and the headline inflation is expected to peak in Q4FY22 and turn moderate in H2GY23. Continued policy support is warranted for a durable, broad-based recovery”, he added.
The six-member Monetary Policy Committee headed by Reserve Bank of India Governor Shaktikanta Das started deliberations on the bi-monthly policy review on Tuesday and made the announcements on Thursday. The meeting of the top bank was originally scheduled to take place between February 7 and February 9 but was deferred by a day after the Maharashtra government declared February 7 a public holiday to mourn the death of legendary singer Lata Mangeshkar.