Mumbai, Apr 7 (FN Agency) The Reserve Bank of India (RBI) on Wednesday kept key interest rates unaltered and maintained an accommodative policy stance to nurture a fragile economic recovery amid new wave of Covid-19 cases. The Reserve Bank of India (RBI) kept the repo rate unchanged at 4 pc. The reverse repo rate remained unchanged at 3.5 per cent, and marginal standing facility and bank rate kept unchanged at 4.25 per cent.
Announcing the bi-monthly policy today the governor said that the RBI will remain accommodative as long as necessary to sustain growth on a durable basis. RBI had kept the key interest rate (repo) unchanged for the fifth consecutive meeting. On the back of the COVID-19 pandemic, the central bank has cut policy rates to 4 per cent through two rate cuts of 75 bps in March’20 and 40 bps in May’20. Global economy is showing some recovery but the path remains uncertain, said RBI governor Shaktikanta Das.
RBI said India’s GDP Growth is projected at 10..5 pc in the financial year 2021-22 while inflation is seen at 5.2% in the first half of FY22. For Q3 and Q4, CPI inflation is seen at 4.4pc and 5.1 pc respectively, the governor said. In spite of surge in Covid-19 infections, the economic activity is normalising the governor said adding that urban demand has gained traction and should get fillip from recent vaccination drive. “Firms engaged in manufacturing, services and infrastructure polled by RBI in March are optimistic about the pick-up in demand and expansion in business activity in FY22,” Das added. RBI Governor Shaktikanta Das said that Consumer Price Index (CPI) inflation trajectory is likely to be subject to both upside and downside pressures.