Indian economy on relatively path of recovery but it can’t be immune to global situation: RBI Governor

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RBI Governor Shaktikanta Das on Wednesday said that the Indian economy is relatively well positioned on path of recovery but it cannot be immune to global situation, says Governor Das.

Das, announcing the outcome of the Reserve Bank of India (RBI) Monetary Policy said that Globally, economies are opening up, activities level are reaching pre-pandemic level.

He also said the headline inflation would peak in the fourth quarter of the current fiscal. The inflation projection has been retained at 5.3 percent for the current financial year.

Retail inflation rose to 4.48 percent in October from 4.35 percent in September, mainly due to higher fuel and edible oil prices.

Benchmark Interest Rate

MPC has been given the mandate to maintain annual inflation at 4 percent until March 31, 2026, with an upper tolerance of 6 percent and a lower tolerance of 2 percent.

The RBI on Wednesday kept the benchmark interest rate unchanged at 4 percent and decided to continue with its accommodative stance in the backdrop of concerns over the emergence of the new coronavirus variant Omicron.

Monetary Policy Committee (MPC)

This is the ninth time in a row that the Monetary Policy Committee (MPC) headed by RBI Governor Shaktikanta Das has maintained the status quo. RBI had last revised its policy repo rate or the short-term lending rate on May 22, 2020 in an off-policy cycle to perk up demand by cutting the interest rate to a historic low.

MPC has decided to keep the benchmark repurchase (repo) rate at 4 percent, Das said while announcing the bi-monthly monetary policy review. Consequently, the reverse repo rate will continue to earn 3.35 percent for banks for their deposits kept with RBI. (Zee News)