Growth recovering, but external shocks pose biggest risk to prices: MPC

There is a slack in the economy, and the RBI governor expected it to exceed the pre-pandemic level of output only in the third quarter of 2021-22

The monetary policy committee (MPC) members of the Reserve Bank of India (RBI) saw economic recovery happening, but external environment posing a risk to the inflation front, causing a data dependent approach, minutes released on Friday showed.

The six-member MPC, after three days of deliberation, kept the policy rate and stance unchanged. The repo rate continues to be at 4 per cent, reverse repo at 4.35 per cent, and the stance at accommodative.

RBI governor Shaktikanta Das emphasised that while the central bank remained “laser-focused” to bring back consumer price index (CPI) inflation a 4 per cent, during the last