New Delhi: The Reserve Bank of India Governor Shaktikanta Das on Friday announced the policy decision of the Monetary policy committee on Friday at 10 am.
The Monetary Policy Committee (MPC) of the Reserve Bank of India on Friday decided to keep repo rate unchanged at 4%. The Reserve Bank’s MPC began its meeting on Wednesday.
While announcing the decisions, RBI governor Shaktikanta Das said that the Monetary Policy Committee (MPC) had voted unanimously to keep the repo rate unchanged at 4 per cent. The repo rate had been slashed by 115 basis points since late March last year to support growth. The Gross Domestic Product (GDP) growth rate was forecasted at 10.5 per cent for the upcoming financial year.
The GDP growth rate was projected at 10.5 per cent for the financial year 2021-2022 by the RBI. Das added the economy would rebound to 10.5 per cent in the next financial year.
The RBI announced that the retail inflation rate would come down to 5.2 per cent in the current quarter and further decline to 4.3 per cent by the third quarter of the next fiscal. “The Centre will be reviewing the inflation target by March-end,” Das added.
The MPC has decided to continue with an accommodative stance of monetary policy as long as necessary at least throughout the current financial year along with the consecutive year in order to “revive growth on a durable basis and mitigate the impact of the coronavirus (Covid-19) disease pandemic.”
RBI governor Shaktikanta Das said that retail investors can buy government bonds through `RetailDirect’ which allows them to open accounts and participate in primary and secondary g-sec market.This will make India one of the few countries to allow such an access to trading in government securities, he said, adding that this is a major structural reform.
Das towards the end of the address said that while 2020 tested India’s capability and endurance, this year would set the stage for a new economic era adding that the economy would be only moving in the upward direction from future. “It is our strong conviction, backed by forecast, that in 2021-22 we will undo the damage inflicted by Covid-19 on the economy,” he said.