RBI monetary policy highlights: Last mile of disinflation is always challenging, sticky, says Governor Das

RBI MPC highlights: Catch all the highlights related to RBI's Monetary Policy Committee announcements here

2:31 PM

RBI policy been somewhat pegged to Fed, even as it formally targeted inflation: Lead economist, Emkay Global

"The RBI policy has been somewhat pegged to the Fed, specifically over the last two years, even as it formally targeted inflation. This seems fair, as external dynamics have been fluid, implying that the policy prerogative needs to be flexible for ensuring financial stability," said Madhavi Arora, lead economist at Emkay Global. 

2:22 PM

RBI MPC updates: Central bank to soon launch app to enable retail investors to participate in govt bond

The RBI today announced the launch of a mobile app to enable retail investors to participate in government securities (G-Secs) or government bonds market. RBI had launched Retail Direct Scheme in November 2021 to give access to individual investors to maintain gilt accounts with the RBI and invest in government securities.

 

2:19 PM

RBI to allow investment, trading of Sovereign Green Bonds at IFSC, Gujarat

The RBI today stated that it will allow investment and trading of Sovereign Green Bonds (SGrBs) at the International Financial Services Centre (IFSC), Gandhinagar.

1:56 PM

RBI MPC news updates: Central bank to release framework on fintech self-regulatory organization by April-end

The RBI had released the draft framework for recognising Self-Regulatory Organisations for the fintech sector (SRO-FT) in January this year. The RBI is of the opinion that the SROs will promote a balance between innovation and regulatory compliance in a manner that protects consumer interests.

1:47 PM

Slight dialling down of RBI's hawkish rhetoric was an interesting aspect: Capital Economics

"The RBI kept the repo rate on hold at 6.5% today as expected but the more interesting aspect was the slight dialling down of its hawkish rhetoric. With inflation grinding down towards the central bank's 4% target, we remain comfortable with our view that the RBI will start cutting rates in the third quarter."

"We think inflation will continue to gradually drop back over the coming months, reaching the 4% target by the middle of the year. As inflation falls, a change in policy stance looks on the cards for the June meeting, which would lay the groundwork for a 25 basis points rate cut in August," Shilan Shah, deputy chief emerging markets economist, Capital Economics, said today on RBI's MPC announcement.

1:43 PM

Possibility of rate cut being pushed to 3rd quarter or possibly 4th quarter: India economist, Societe Generale

RBI MPC reactions: "With this decision, the June rate cut is definitely off the table and there is a possibility of rate cut being pushed eventually to the third quarter and possibly fourth quarter." "Although inflation is clearly easing, RBI does not see its trajectory suggesting a move toward its median target of 4.0% on a durable basis. With food inflation being the prime driver of headline inflation while core inflation is at its pandemic low and well below RBI's median inflation target, we feel that the hawkish monetary policy stance will potentially cost growth," Kunal Kundu, India economist, Societe Generale, said today.

1:39 PM

Prime focus is on building strong umbrella, strong buffer: RBI Governor Das

"It is our prime focus to build a strong umbrella, a strong buffer in the form of a substantial quantum of forex reserves which will help us when the cycle turns or when it rains heavily," RBI Governor Shaktikanta Das said today at  the post policy press conference. Despite India's strong growth and inflows into equity and debt markets, the Indian rupee continues to trade near record lows as the central bank has chosen to absorb dollar inflows to build reserves. Foreign exchange reserves hit a record high of $645.6 billion as of March 29, Das said. 

1:22 PM

RBI reiterates FX exposure must for rupee exchange derivative transactions

The Reserve Bank of India (RBI) on today emphasised that underlying foreign exchange exposure is necessary for transacting in rupee derivatives on exchanges.

The requirement of underlying exposure for rupee derivatives has always been the RBI's policy "for the last so many years", tGovernor Shaktikanta Das stated at a post policy media conference.

1:01 PM

India to broaden e-rupee distribution beyond banks to boost retail use: RBI

The Reserve Bank of India (RBI) said today that it is planning to use non-bank payment system operators, including third-party payment app providers, to make the e-rupee more accessible to retail users. The RBI piloted its central bank digital currency (CBDC) in 2023 but only allowed banks to offer these tokens, which led to subdued transaction volumes. The central bank has proposed that non-bank payment system operators, which include third-party payment app providers like PhonePe, Google Pay and Paytm, offer the e-rupee through CBDC wallets.

12:50 PM

MPC updates: RBI sees no need to review the necessity of the 'small finance bank' tag, says Dy Governor Rao

Deputy Governor Rajeswar Rao stated that having the tag of Small Finance Bank is part of the differentiation initiative. He added that RBI sees no need to review the necessity of the 'small finance bank' tag.

12:43 PM

RBI MPC news updates: Can’t give forward guidance on future rate action, says Governor Das

We cannot give forward guidance on future rate action. Our policy is primarily guided by domestic conditions, Governor Shaktikanta Das said. He added, "We do not follow the footsteps of the US Fed."

12:40 PM

RBI MPC LIVE updates: RBI governor refrains from commenting on electoral bonds

RBI Governor Shaktikanta Das refrains from commenting on question related on electoral bonds.

12:38 PM

RBI building gold reserves as part of India's forex reserve deployment: Governor Das

We are building gold reserves that is part of our forex reserve deployment, says RBI Governor Shaktikanta Das. No change in RBI's foreign exchange risk management policies, RBI Deputy Governor M D Patra on exchange-traded currency derivatives

12:33 PM

No change in RBI's foreign exchange risk management policies, says RBI Deputy Governor Patra

No change in RBI's foreign exchange risk management policies, RBI Deputy Governor MD Patra on exchange-traded currency derivatives. 

12:27 PM

RBI MPC LIVE Updates: Will keep watch on proteins so that prices do not spill over, says Deputy Governor Patra

Food inflation has been highly volatile. The proteins have been keeping the prices high, said Deputy Governor Michael Patra. "We will watch it closely so that it does not spill over," he added.

12:24 PM

Not much concern on wheat availability, says Governor Das on IMD projection of high temperature in April-June

Vegetable prices will have to be watched, not much concern on wheat availability, RBI Governor Das said today on IMD projection of high temperature in April-June.

12:20 PM

Last mile of disinflation is always challenging, sticky, says RBI governor

Last mile of disinflation is always challenging, sticky, says RBI Governor Shaktikanta Das. He also said that building forex reserves adds to the strength of the national balance sheet.

12:15 PM

RBI MPC LIVE Updates: Vegetable prices need to be watched, says RBI governor

Heatwave is not of much worry, but vegetable prices need to be watched, RBI governor Das said today.

12:13 PM

RBI MPC post-policy press conference: The elephant is moving slowly, says RBI Governor Das

The last mile of disinflation is always sticky. We want to align with our inflation target on a durable basis, Governor Das said referring to his "elephant" comment on CPI.

11:42 AM

RBI MPC: Significant announcements made by Governor Shaktikanta Das

While projecting a positive growth outlook for FY25 amid improving global indicators and growing domestic demand, RBI Governor Shaktikanta Das highlighted that high food inflation needs to be closely monitored. Click here for a detailed report on the major announcements made by Governor Shaktikanta Das.

11:38 AM

RBI to review liquidity coverage ratio framework: Governor Shaktikanta Das

Reserve Bank Governor Shaktikanta Das today announced a review of the liquidity coverage ratio for banks to ensure smooth functioning even in events of acute stress. This warrants a revisiting of the assumptions made under the liquidity coverage ratio framework, Das said, adding that it is only in events of "acute stress" that such a framework would be helpful.

11:36 AM

Stocks trade flat as realty stocks counter weak IT on RBI rates pause

Shares were flat today, paring earlier losses as real estate stocks were strengthened from RBI's pause on rates, whereas IT stocks dropped amid uncertainty around US interest rate cuts.

11:14 AM

Impact of reduction in fuel prices on inflation will deepen in coming months: RBI Governor Das

Reserve Bank Governor Shaktikanta Das  underscored the need to remain vigilant on food prices, given the forecast of higher temperatures between April-June. Das also stated that the impact of reduction in fuel prices on inflation will deepen in the coming months. The RBI today retained inflation projection at 4.5 per cent for the current financial year, lower than 5.4 per cent in the last fiscal.

11:01 AM

Strong growth momentum could limit rate cut in easing cycle: Chief economist, India Ratings

 

"We expect monetary easing either through rate cut or change in stance to begin from October 2024. The strong growth momentum may limit rate cut in easing cycle to 50 to 75 basis points," Devendra Kumar Pant, chief economist, India Ratings 

10:55 AM

Uncertainty on food inflation remains a worry: Chief economist, Kotak Mahindra Bank

"The Monetary Policy Committee (MPC) on expected lines maintained status quo on rates and stance. While low core inflation provides comfort, the uncertainty on food inflation remains a worry.Further, the higher U.S. yields, higher oil prices and other commodities along with possible delay in Fed's rate easing cycle will keep the MPC wary," Upasna Bhardwaj, chief economist, Kotak Mahindra Bank, said today.

10:38 AM

RBI MPC Live updates: Forex reserves at all-time high, says RBI Governor Shaktikanta Das

India’s forex reserves at $645.6 billion as of March 29, RBI Governor Das said today.

10:34 AM

Growth momentum along with GDP forecast for FY25 will give space to focus on price stability: RBI governor

The strong growth momentum together with GDP forecast for FY25 give us policy space to unwaveringly focus on price stability, RBI Governor Shaktikanta Das said tody.

10:31 AM

RBI retains inflation forecast at 4.5%, says RBI governor

RBI retains inflation forecast at 4.5 per cent with risk evenly balanced assuming normal monsoon for current fiscal, Governor Das said today.

10:28 AM

Second advance estimates placed the real GDP growth at 7.6% for 2023-24: RBI governor

"India presents a different picture on account of its fiscal consolidation and faster GDP growth. Turning to domestic growth, domestic economic activity continues to expand at an accelerated pace, supported by fixed investment and an improving global environment. The second advance estimates placed the real GDP growth at 7.6% for 2023-24, the third successive year of 7% or higher growth," RBI Governor Shaktikanta Das said today.

10:23 AM

RBI MPC update: India's GDP growth for FY25 projected at 7%, says Das

India's GDP growth for FY25 projected at 7 per cent, RBI Governor Shaktikanta Das said today.