Mehta hopes RBI continues to support growth impulses in the economy
The Reserve Bank of India has maintained consistency in the policy statement made on 5 Aug 2022 by focusing on withdrawal of accommodation to contain inflation.
The RBI has hiked the policy repo rate by 50 basis points, to 5.40%.
The Central Bank has delivered the third consecutive increase in the policy rate today (5 Aug) – increasing the benchmark repo rate by a total of 140 bps since May this year, said FICCI President Sanjiv Mehta on the increase in repo rate.
“Inflation has been over the comfort range of the Central Bank, however, the recent moderation in global commodity prices should hopefully offer some respite going ahead,” he said.
The uncertainty on external front remains on fore. Nonetheless, the Central Bank has retained the growth forecast for 2022-23 at 7.2 percent – which is encouraging.
The capacity utilization rate for Q4 2021-22 at 75.3 is over the long-term average and should lead to improvement in investment activities going forward.
The medium-term growth drivers for India are very much intact and recovery is expected to find a firmer ground by the latter part of this fiscal year.
“We further hope as inflation ebbs, RBI will dynamically manage its monetary policy stance and continue to support growth impulses in the economy,” added Mehta.
The Monetary Policy Committee of the RBI came to this judgement since it felt the need to keep inflation and inflationary expectations under check.
“Sustained high inflation could destabilize inflation expectations and harm growth in the medium term”, the RBI Governor Shaktikanta Das said, delivering the Monetary Policy Statement online. fiinews.com
