RBI shocks with repo rate hike, CRR hike

In a big hit to the common man, RBI Governor Shaktikanta Das announced a rate hike of 40 bps with immediate effect. The Reserve Bank of India(RBI) met in an off-cycle meet on May 2 & 4 and decided unanimously to raise rates as inflation pressures continues to risk growth, RBI governor Shatikanta Das said in his surprise address.

Also watch| RBI Governor Shaktikanta Das warns of much higher food prices despite rate hike shock

Inflation in India has been above the RBI's tolerance level for the last 3 months. The RBI Governor raised the red flag for inflation blaming the war and admitting that India is not immune to these global shocks.

Here are the highlights of the speech after an offcycle meeting of the RBI on May 4:

• India is not an island in this globally connected world

• Risk of inflation to remain elevated at these levels for 'too long'

• India has been confronted with higher inflation due to ongoing war

• Must incorporate new economic realities into our thinking and policy

RBI Governor Shaktikanta Das warns of much higher food prices despite rate hike shock

• Economic effects of the war are spreading far and wide

• Debt distress is rising among developed world

• Recent GDP releases suggest global growth is slowing down

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