The six-member Monetary Policy Committee headed by the RBI Governor Shaktikanta Das on June 8 unanimously raised the repo rate, the key policy rate at which the central bank lends short-term funds to banks, by 50 bps to 4.90%.
The latest hike comes after the Reserve Bank announced a 40 bps increase in repo rate in an off-cycle policy move in May.
Top 8 highlights from RBI Governor Shaktikanta Das' monetary policy speech:
The Standing Deposit Facility and Marginal Standing Facility rates raised by 50 basis points. The Standing Deposit Facility rate is now 4.65 percent, and the Marginal Standing Facility rate is now 5.15 percent. MPC voted unanimously to remain focused on the withdrawal of accommodation to ensure inflation remains within target going forward.
GDP growth forecast for FY23 retained at 7.2 percent. GDP growth forecast at 16.2 percent for April-June. GDP growth forecast at 6.2 percent for July-September. GDP growth forecast at 4.1 percent for October-December. GDP growth forecast at 4.0 percent for January-March 2023.
CPI inflation forecast for FY23 raised to 6.7 percent from 5.7 percent. RBI Inflation forecast assumes normal monsoon and crude basket price at $105/barrel. While normalising pandemic-related measures, RBI will ensure adequate liquidity in the banking system.
RBI is monitoring the government securities market very closely. We will take the necessary steps as and when required.
As of June 3, India's foreign exchange reserves stood at $601.1 billion.
Limits on individual home loans given by urban and rural co-operative banks are being revised upwards more than 100 percent taking into account the rise in housing prices over the last decade.
The limit on recurring e-payments is now raised to Rs 15,000 from Rs 5,000 to further facilitate transactions such as subscriptions.
Credit cards, starting with RuPay credit cards, can now be linked to UPI. The implementation will begin with the indigenous RuPay credit cards being allowed to be linked.
By LNN (Liyaans News Network)