" With the assumption of a normal monsoon, in 2022 and average crude oil price in the Indian basket of 105 dollars per barrel, inflation is now projected at 6.7 percent in 2022-23.”
The six-member Monetary Policy Committee headed by the Reserve Bank of India (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.
India’s faces immediate challenges on the growth, inflation and fiscal fronts but its medium-term fundamentals remain solid, chief economic advisor V Anantha Nageswaran said on June 8.
“We are right now in a situation where there is considerable amount of challenges that we face for the Indian economy both from the global macro monetary policy and political developments,” Nageswaran said at an event, in his first comments after the Reserve Bank of India raised its policy rate by 50 basis points.
(With inputs from agencies)