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RBI Retains FY22 GDP Growth Projection at 10.5% Amid COVID Surge

The Reserve Bank of India has kept the repo rate unchanged at 4 percent for the fifth time. 

Updated
India
2 min read
Reserve Bank of India Governor Shaktikanta Das. 
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The Reserve Bank of India (RBI) has kept the repo rate unchanged at 4 percent for the fifth time, maintaining an accommodative monetary policy stance to support growth and keep the inflation at the targeted level, Governor Shaktikanta Das said on Wednesday, 7 April. The reverse repo rate stands at 3.35 percent.

The projection of real GDP growth for 2021-22 has been retained at 10.5 percent, he said.

However, he pointed out that the recent surge in COVID-19 cases has created uncertainty over the economic growth recovery amid tightening of restrictions by some state governments.

The focus for India, he said, must remain on containing the surge of coronavirus in India and thereby help economic recovery.

RBI to Ensure Liquidity

  • In order to boost the productivity sector, the RBI will ensure ample liquidity in the system
  • Rs 50,000 crore additional liquidity facility to NABARD, NHB and SIDBI for fresh lending during 2021-22
  • The central bank will ensure orderly conduct of government borrowing and preserve financial stability
  • RBI has also enhanced aggregate ways and means advances limits to states to Rs 47,010 crore.

RBI Expects 5.2% Retail Inflation for First Half of FY22

Further, the RBI informed that it expects retail inflation at 5.2 percent in the first half of financial year 2022.

Even though headline inflation at 5 percent in February 2021 remains within the tolerance band, some underline constituents are testing the upper tolerance level.

Das, also, as per PTI, said that there has been some respite from the incidence of domestic taxes on petroleum products. However, he added that coordinated actions by the Centre and states could provide relief on top of the recent easing of the international crude prices.

(With inputs from PTI and ANI.)

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