The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) has announced its bi-monthly monetary policy decision.
Announcing the decisions, RBI governor Shaktikanta Das said that the RBI has decided to keep the repo rate unchanged at 4 per cent till March end with an upper tolerance of 6 per cent and lower tolerance of 2 per cent. Consequently, the reverse repo rate also remained unchanged at 3.35 per cent.
Das added the economy would rebound to 10.5 per cent in the next financial year. The Gross Domestic Product (GDP) growth rate forecasted at 10.5 per cent for the financial year 2021-2022.
Further, it announced that the retail inflation rate would come down to 5.2 per cent in the current quarter and further decline to 4.3 per cent by the third quarter of the next fiscal. “The Centre will be reviewing the inflation target by March-end,” Das added.
According to Das, while 2020 tested India’s capability and endurance, “It is our strong conviction, backed by forecast, that in 2021-22 we will undo the damage inflicted by Covid-19 on the economy,”. This year would set the stage for a new economic era adding that the economy would be only moving in the upward direction from future, he added.