RBI Monetary Policy: In the last monetary policy of the year and also marking in a way the start of the end of the pandemic the RBI unveiled it's policy but it was still clouded covid.
Also watch | RBI Monetary Policy: Central bank does not rock the boat, holds rates
Here is everything the RBI announced and did not announce as we step into a new year
- Repo rate held at 4%, the level it has been since May 2020 when the pandemic struck. So your loan rates are not moving higher anytime soon.
- Reverse repo rate (the rate which RBI pays banks for surplus cash) was also unchanged. Many expected to see a hike which would have led to a savings rate hike for the public as well.
- Accommodative is the word of the day - The RBI alluded to the clouding of the recovery process due to Omicron and promised to hold the economy's hand through the new twists and turn in the Covid tales.
- What experts are reading into it: Expect a delayed rate normilization from the RBI, all eyes will shift to the Fed for the road ahead for rates globally.
- News you can use: RBI has proposed to launch UPI transactions on feature phones while also looking at a on-device wallet feature also. The central bank is also going to enhance payment limits via UPI for IPO application et al
The central bank expect the economy to still pull off 9.5% expansion in the year ending March, and does not see any runaway risk to prices as it retained the inflation forecast of 5.3% for the full year.