The Reserve Bank of India Governor Shaktikanta Das during the RBI MPC meet announced that the repo rate will remain unchanged at 6.5 per cent. The MPC’s decision to leave the repo rate unchanged was unanimous, said RBI governor, he also added that MPC will not hesitate to take any further action if required.
Das also said that economic activity remains resilient with the economy expected to grow 7 per cent.
RBI Governor Shaktikanta Das during his presentation said that the 2023-24 GDP growth forecast was raised to 6.5 per cent from the previous 6.4 per cent. The GDP growth forecast for April-June is retained at 7.8 per cent, for July-September at 6.2 per cent, October-December GDP is raised to 6.1 per cent from previous 6 per cent, while the January-March GDP growth forecast has been raised to 5.9 per cent.
The CPI Inflation forecast for 2023-24 has been lowered from 5.3 per cent to 5.2 per cent, with the first quarters CPI inflation forecast at 5.1 per cent raised from 5 per cent. The second quarter CPI inflation forecast has been retained at 5.4 per cent, for the third quarter it is at 5.4 per cent whereas for the last quarter it has been reduced to 5.2 per cent from 5.6 per cent previously.
Shaktikanta Das said, “While MPC has kept the policy rate unchanged, our job is not yet finished and the war against inflation has to continue until we see a durable decline in inflation closer to the target.”
Retail inflation in February stood at 6.44 per cent compared to 6.52 per cent in the previous month. MPC takes into account retail inflation numbers for setting the interest rates.
However, inflation is expected to moderate in the current fiscal. Many institutions, including the World Bank and Asian Development Bank, have predicted that inflation would cool down to about 5 per cent this financial year.
The global economy is facing financial challenges in wake of the recent failures in the banking sector and RBI is keeping a close watch on the banking sector turmoil in some developed countries. He also said that the Indian banking and non-banking financial system remains healthy.
RBI Governor Das said that the rupee has moved in an orderly manner in the last year and it continues in this year. He also said that the RBI will continue to be watchful and focused on maintaining the stability of the Indian rupee.
He also announced that a new centralised web portal will be formed for the public to search for unclaimed deposits.