A straight jacket policy by the RBI as the Omicron threat looms

The next policy in February will be come post the Budget announcement. It will be crucial as the state of the economy will be clear as will the action taken by the government to counter Omicron impact

The discourse in the Monetary Policy Committee (MPC) meeting of the Reserve Bank of India (RBI) has taken a turn post the Omicron threat. It otherwise seemed to be, more or less, straight jacketed with the RBI laying down the path to unwinding that started off in a rather mild manner in October. Let us see the main issues that the MPC was to throw light on.

First was the confidence level in the growth process, which looked upbeat post the Q2 GDP results coming in. Second was a call on the repo rate, which was not expected to change