The Reserve Bank of India has announced its monetary policy on 4th June 2021, the Monetary Policy Committee (MPC) meeting is done under the guidance of the Governor, Mr. Shaktikanta Das. What all have been announced we will discuss in this article as we go ahead.
- The Repo Rates are unchanged at the 4% mark.
- The Bank Rates are also unchanged at 4.25%.
- The Reverse Repo Rates are still at the 3.35% mark.
- The Reserve Bank of India has maintained an accommodative stance concerning the policies.
- It seems that the RBI has also maintained Status Quo as according to them no changes are required.
- Concerning the growth in Real GDP, the RBI has reduced the projections from 10.5% earlier to 9.5% in FY22.
- The growth in Real GDP for Q1 FY22 will remain at 18.5% due to negative growth of -24% Q1 FY20.
- The growth in Real GDP for Q2 FY22 will be at 7.9%, for Q3 FY22 it will be at 7.2% and for Q4 FY22 it will be at 6.6%.
- The monsoon this year will be normal, which will support the economy a lot. Because the Agricultural sector performs well, then, there will be a positive cascading impact on the various sectors of the economy.
- The expected Consumer Price Index (CPI) inflation will be at 5.1% for FY22.
- The expected CPI inflation for Q1 will be at 5.2%, for Q2 FY22 will be at 5.4%, for Q3 FY22 it will be at 4.7% and for Q4 FY22 it will be at 5.3%.
- Due to a recent fall in inflation, the RBI is taking an accommodative stance.
- The current FOREX reserves by RBI are around $600 billion.
We should now focus on the growth numbers projected by RBI. The inflation numbers are looking under control, the monsoon is also looking normal which is a good sign for the economy.