RBI via PIB:
The repo rate, the rate at which RBI lends money to commercial banks, has been hiked by one half of a percent.
Considering the prevailing adverse global environment, resilience in domestic economic activity, uncomfortably high inflation level, the RBI has hiked the policy repo rate by 50 basis points, to 5.40%.
The Monetary Policy Committee of the RBI came to this judgement since it felt the need to keep inflation and inflationary expectations under check.
“Sustained high inflation could destabilize inflation expectations and harm growth in the medium term”, the RBI Governor Shaktikanta Das said, delivering the Monetary Policy Statement online.
The Governor’s address can be watched here: https://youtu.be/2VXCSN9Ypes.
Additional Measures
Bharat Bill Payment System to be open to NRIs as well
The Bharat Bill Payment System (BBPS), an interoperable platform for standardized bill payments, will now be able to accept cross-border inward bill payments. This will thereby enable NRIs as well to use the system to pay their bills for utility, education and other such services, on behalf of their families in India. This will thus greatly benefit senior citizens.
Credit Information Companies to be brought under Reserve Bank Integrated Ombudsman Scheme (RB-IOS) 2021
To make the RB-IOS more broad-based, Credit Information Companies (CICs) are being brought under the RB-IOS framework. With this, we get a cost-free alternative mechanism for redressal of grievances against Credit Information Companies.
Further, these companies will now need to have their own internal Ombudsman (IO) framework. The Governor informed that this will strengthen the internal grievance redress mechanism by CICs themselves.
No change in Growth Projection – 7.2% for 2022-23
The Governor informed that the central bank’s growth projection for the Indian economy remains unchanged, at 7.2% for the current financial year, with Q1 at 16.2 per cent; Q2 at 6.2 per cent; Q3 at 4.1 per cent; and Q4 at 4.0 per cent. Real GDP growth for Q1:2023-24 is projected at 6.7 per cent
On inflation, the Governor explained that monetary policy should persevere further in its stance of withdrawal of accommodation to ensure that inflation moves close to the target of 4.0 per cent over the medium term, while supporting growth. The Governor informed that RBI reiterates its commitment to maintain price and financial stability to place our economy on a sustainable path of growth.