Following are the highlights of the RBI’s fourth monetary policy review of fiscal year 2022-23 announced by Governor Shaktikanta Das:
* Key short-term lending rate (repo) raised by 50 basis points (bps) to 5.4 per cent; third consecutive hike
* In all, 140 bps hike in repo since May 2022 to check inflation
* GDP growth projection for 2022-23 retained at 7.2 per cent (pc).
* GDP growth projection: Q1 at 16.2 pc; Q2 at 6.2 pc; Q3 at 4.1 pc; and Q4 at 4 pc
* Real GDP growth for Q1:2023-24 projected at 6.7 per cent
* Domestic economic activity exhibiting signs of broadening
* Retail inflation projection too retained at 6.7 pc for 2022-23
* Inflation projection: Q2 at 7.1 pc; Q3 at 6.4 pc; and Q4 at 5.8 pc; Q1:2023-24 at 5 pc
* India witnessed large portfolio outflows of USD 13.3 billion in FY23 up to August 3
* Financial sector well capitalised and sound
* India’s foreign exchange reserves provide insurance against global spillovers
* Monetary Policy Committee decides to remain focused on withdrawal of accommodative stance to check inflation
* Depreciation of rupee more on account of appreciation of US dollar rather than weakness in macroeconomic fundamentals of the Indian economy
* RBI to remain watchful and focused on maintaining stability of rupee
* Rupee depreciated by 4.7 pc against US dollar this fiscal year till August 4
* India’s foreign exchange reserves remain fourth largest globally
* Mechanism to be activated to allow NRIs to use Bharat Bill Payment System for payments of utility and education on behalf of their families in India
* Next meeting of rate-setting panel scheduled for September 28-30, 2022.
