RBI MPC meet live updates: The RBI predicts inflation will average 4.5% in the coming fiscal year beginning in April, Das said. The economy has performed “remarkably well,” with growth likely to reach 7% in the period, he said. “The job is not yet finished and we have to be vigilant of new supply shocks,” Das said.
Benchmark 10-year bond yields pared early gains to trade flat at 7.07% after the rate announcement. The rupee edged 0.1% higher to 82.93 per dollar while stocks were little changed.
Inflation remains firmly above the 4% target, largely due to higher food prices. The core measure, which strips out food and fuel costs, has eased below that level, though, suggesting demand-led pressures remain subdued.
Only time will tell when a rate cut will happen, RBI Governor Shaktikanta Das said. On another question on Paytm, Das said regulations are robust, and this was not a case where there was regulatory deficiency. Paytm issue is one of compliance related to various aspects.
Deputy Governor Swaminathan said there is still time for customers to access services of Paytm. Very difficult to provide hypothetical answers at this time. We keep customer at the centre of what needs to be done. Each bank has to take their own business decisions with respect to partnership with Paytm.
When constructive engagement doesn't work or when regulated entity does not take effective action, we go for imposing business restrictions, said RBI Governor Shaktikanta Das. Our emphasis is always on bilateral engagement with regulated entities, with a focus on nudging the entity to take corrective actions: RBI Governor Shaktikanta Das.
There is no worry about the system, we are only talking about a specific payments bank, says RBI Guv on Paytm fiasco
Governor Shaktikanta Das in the post review presser said if there is compliance, why would the regulator act. The governor, however, said the remarks were in general context and not related to Paytm
Stance is about future course of policy rates, says Deputy Governor Michael Patra. Liquidity is endogenous to the rate. We have to move liquidity to achieve a certain rate. Objective is to keep weighted average call rate around repo rate.
RBI MPC members Shaktikanta Das, Shashanka Bhide, Ashima Goyal, Rajiv Ranjan and Michael Debabrata Patra voted to keep the policy rate unchanged. The only exception remained Jayanth R. Varma, who voted to reduce the policy repo rate by 25 basis points.
"The RBI's decision to maintain the repo rate at 6.5% signals stability amidst global slowdown. Increased liquidity due to reduced govt borrowing will bring down rates. it also reflects support for economic growth and financial stability. With inflation expected to ease in 2024, the RBI's cautious approach aims to strike a balance between containing inflation and fostering economic momentum.”
-- Rajiv Agarwal, MD & CEO, Essar Ports
“The Reserve Bank of India's decision to maintain the benchmark interest rate at 6.5 per cent reflects its cautious approach to balancing both inflationary concerns and sustained economic growth. By keeping the repo rate unchanged, it shows the central bank's dedication to creating a favorable environment for investment and ensuring stability in the financial markets. This decision signifies the RBI's commitment to fostering economic growth while managing inflation risks, which is crucial for maintaining a healthy financial landscape in India.”
-- Sanjay Palve, Senior Managing Director, Essar Capital Ltd
The RBI kept its interest rates unchanged at 6.5% in the recently announced monetary policy. This is the sixth consecutive time that the interest rates has remained unchanged and the longest pause in rates since 2008 in a rising interest rate environment. The RBI policy is more of a non-event as nothing new was mentioned in it. India 10 Year Bond yields spiked from the lows of 7.04% to 7.09% as the governor kept on emphasizing that RBI will watch out for inflation to cool off below 4% for them to be comfortable with rate cuts. We believe that since our economic growth is stable and US Fed too is in no mood to cut rates soon one can expect RBI to maintain its hawkish stance in H1CY2024.
-- Apurva Sheth, Head of Market Perspectives and Research, SAMCO Securities
The yield on the government securities rose 1 basis point during the monetary policy announcement. One basis point is one-hundredth of a percentage point. The 10-year benchmark 7.18 percent 2033 bond yield was trading at 7.0716 percent at 10:19am, as against a 7.0723 percent close in the previous trading session
RBI allows resident entities to hedge price of gold in OTC segment in IFSC, the Reserve Bank of India Governor said.
As of Feb 7, Indian rupee remained stable compared to emerging market peers and few advanced economies. Indian rupee exhibited lowest volatility in FY24, says Guv Das.
Current account deficit in Q2 of FY24 declined to 1% of GDP versus 3.8% a year ago
Home loan borrowers got a relief with no change in their monthly installments as the RBI Monetary Policy Committee kept the repo rate unchanged at 6.5 percent for the sixth consecutive time.
-- CPI inflation in Q1 at 5%, 4% in Q2, 4.6% in Q3, and 4.7% in Q4. -- Inflation projections are based on assumption of normal monsoon -- There is considerable uncertainty about food inflation
Guv Das said it needs to be vigilant on new supply shocks. Headline inflation remains high with considerable volatility this year. CPI inflation target of 4% is yet to be reached, he said.
Domestic economic activity remains strong. The first advanced estimates placed the real gross domestic product that is real GDP growth at 7.3% for 2023 24. That is for the current year, making this third successive year of growth above 7%
The challenges of debt sustainability in an environment of high-interest rates and low growth at the global level can become new sources of stress, says Guv Das.
Global growth expected to remain steady in 2024, even as global trade momentum remains weak, says Shaktikanta Das. Global trade likely to grow faster in 2024. Elevated levels of public debt is raising concerns on macro stability.