Highlighting no dependency on a single point or number for next monetary policy review in Mid-December, Reserve Bank of India’s governor has underscored that several factors, like price situation and other macroeconomic indicators, including the value of rupee, besides inflation, would be considered, while making next monetary policy decision.
Further, RBI’s governor, Raghuram Rajan averred that it would watch the incoming data carefully, especially the effects of the harvest on food prices as well as the second round effects of fuel price increases and exchange rate depreciation, before it could make further decisions on interest rates.
In an attempt to somewhat calm fears mainly on account of its tight monetary policy stance, RBI governor highlighted it would also consider inflation as well as economic growth. According to the governor, weak economy, increases in food supply, and recent policy rate hikes will provide a disinflationary impetus over time, and recent data does not dispels this view.
As per the government data, the industrial output grew by a meager 2% in September, while the retail inflation entered in the double digit with October figure at 10.09%. Meanwhile, raising the demand for rate cut to boost growth, India’s economic growth has slowed down to 4-year low of 4.4 percent in the first quarter of the fiscal.
Further, RBI’s governor, Raghuram Rajan averred that it would watch the incoming data carefully, especially the effects of the harvest on food prices as well as the second round effects of fuel price increases and exchange rate depreciation, before it could make further decisions on interest rates.
In an attempt to somewhat calm fears mainly on account of its tight monetary policy stance, RBI governor highlighted it would also consider inflation as well as economic growth. According to the governor, weak economy, increases in food supply, and recent policy rate hikes will provide a disinflationary impetus over time, and recent data does not dispels this view.
As per the government data, the industrial output grew by a meager 2% in September, while the retail inflation entered in the double digit with October figure at 10.09%. Meanwhile, raising the demand for rate cut to boost growth, India’s economic growth has slowed down to 4-year low of 4.4 percent in the first quarter of the fiscal.
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