RBI Monetary Policy Highlights: Repo rate unchanged; Inflation, GDP growth projections retained

RBI Monetary Policy Highlights: Amid the threat posed by the Omicron COVID-19 variant, the Reserve Bank of India (RBI) on Wednesday (December 8) maintained a status quo in its monetary policy, waiting for a more favourable time to calibrate benchmark interest rates to encourage growth without forgoing the primary goal of containing inflation. RBI Governor Shaktikanta Das-headed Monetary Policy Committee (MPC) brought its three-day deliberations to a close today, December 8. The meeting marks the end of the last bi-monthly policy meet of the calendar year. This is the ninth consecutive time that the RBI has maintained a status quo on the key interest rates. The current repo rate has been maintained at 4% by the central bank.

Follow BusinessToday.In for all the latest updates on the RBI Monetary Policy announcement today: -

 

10.56 am: RBI proposes to launch UPI-based payment products feature phone users, says Das

• To make small-value UPI process flow simpler, via on-device wallet.
• UPI transaction limit to be hiked to Rs 5 lakh from the current limit of Rs 2 lakh.
• UPI transaction limit hike only for retail direct scheme for investment of G-Secs and IPO offering applications.
   

10.53 am: Markets will meet the MPC decision with a cheer: Sonam Srivastava, Founder at Wright Research, SEBI RIA

"The markets will meet this policy with a cheer as it is very accommodating to growth, and the country's inflation expectation analysis remains very positive. This is in line with the expectations of the markets and thus, positive sentiment is likely to bolster growth in sectors such as banking, real-estate, export/imports and manufacturing. The stock prices of companies in these domains are likely to see a rise in price. It is indeed a great time for investors to be invested in the market," says Sonam Srivastava, Founder at Wright Research, SEBI RIA.
 

10.49 am: MPC's decision will boost auto sector mainly targeting 4 wheelers and CVS: Ashish Sarangi, RIA  and CSO, Pickright Technologies

"The much-awaited RBI Monetary policy is out and we welcome this move by MPC on maintaining the interest rate flat. This will further boost the auto sector mainly targeting 4 wheelers and CVS. This is currently the hot market as we are seeing many innovations and new players entering the space. Let's see how this will play out in different sectors, Housing sector which is currently reeling under mild depression will see a boost as investors will take advantage of low-interest rates and start investing. So, we see an upward move in the stocks of the housing sector in the near long term," says Ashish Sarangi, RIA  and CSO of Pickright Technologies.
 

10.46 am: RBI decision will bode well for all interest-sensitive sectors: Ramani Sastri - Chairman & MD, Sterling Developers Pvt. Ltd

 

"The RBI's decision on keeping the repo rate unchanged will certainly bode well for all interest-sensitive sectors ahead of the New Year when the economy is on its road to recovery. For home buyers, this decision will help reinstate confidence and further access to affordable home loans and help foster housing demand. It has also helped the sector to regain its strength as well as stay afloat during these unprecedented times. The homebuyers should take advantage of the current situation because there are chances that the prices might go upwards later on account of reducing supply and the pressure of increased costs of raw materials," says Ramani Sastri - Chairman & MD, Sterling Developers Pvt. Ltd.
 

10.43 am: UPI payments without internet? Here's what RBI says

The RBI will release a discussion paper on charges on digital payments in India, and will also launch UPI-based payment products for feature phone users.
 

10.34 am: Inflation to ease soon, says RBI Guv Shaktikanta Das
 

Headline inflation will peak in Q4 of the current fiscal year and soften thereafter, said RBI Governor Shaktikanta Das, adding that the central bank pegs CPI inflation at 5.3% for FY21-22.
 

10.32 am: RBI MPC meet outcome: Industry reactions

"We welcome RBI's status quo on policy rates. Economic growth needs to be supported through monetary policy and this is the foremost reason that the RBI has continued its accommodative stance which has invoked a sense of optimism. With the positive growth of the economy over the last few months, the RBI leaving the repo rate unchanged means homebuyers would continue to reap the benefits of a record low-interest rate regime. Keeping in mind the current scenario, a reduction in the key rates would have been widely celebrated as low-interest rates have been a crucial factor in the revival of demand in the real estate sector," says Lindsay Bernard Rodrigues, CEO & Co-Founder, The Bennet and Bernard Company.
 

10.28 am: RBI Monetary Policy: Key lending rates unchanged, GDP growth, Inflation projections retained; key highlights

Here are the key highlights of the RBI MPC meet outcome: -

The repo rate remains unchanged at 4%
The reverse repo rate stands at 3.35%
The Marginal Standing Facility (MSF) rate is at 4.25%
Real GDP growth retained at 9.5%.
Inflation retained at 5.3% for FY22

10.21 am: CPI-based inflation retained at 5.3% for FY22; policy rate unchanged

Inflation projection has been increased from 4.5 per cent to 5.1% in Q3 and reduced from 5.8 per cent to 5.7 per cent in Q4 of 2021-22.

 

10.18 am: RBI retains GDP projections

The Central kept the real GDP growth projection at 9.5% for the current financial year, comprising of 6.63% in Q3 and 6% for Q4, RBI Governor Shaktikanta Das said.
 

10.12 am: RBI Monetary Policy live updates: MPC voted unanimously to maintain status quo
 

RBI's Monetary Policy Committee votes unanimously to maintain status quo on key lending rates and by a majority of 5:1 to retain the accommodative policy stance.
 

10.09 am: RBI keeps key lending rates unchanged, better prepared to deal with coronavirus, says Shaktikanta Das
 

"We are better prepared to deal with coronavirus," says RBI Governor Shaktikanta Das amid uncertainty over Omicron.
 

10.05 am: RBI keeps repo rate unchanged at 4%, maintains accomodative stance.

 

10.00 am: RBI MPC meet: Liquidity surplus sizeable: Care Ratings
 

The banking system has been flushed with surplus liquidity for the last two and half years and despite measures by the RBI to rein in the surplus, it continues to be sizeable. The daily liquidity surplus (net outstanding) has widened from an average Rs 5.17 lakh crore during Apr to mid -Aug'21 to Rs. 7.6 lakh crore since then, said Care Ratings.

 

9.57 am: RBI Monetary Policy Live Updates: Governor Shaktikanta Das to announce MPC decision shortly

RBI Governor Shaktikanta Das is going to announce the MPC decision at 10 am. 

9.54 am: RBI MPC Policy today: If RBI maintains status quo, it would be 9th consecutive time since the rate remains unchanged

 

The RBI had last revised the policy rate on May 22, 2020, in an off-policy cycle to perk up demand by cutting the interest rate to a historic low.

9.30 am: A Kotak Economic Research report stated that with uncertainty around the new COVID-19 variant Omicron, the RBI would possibly wait for some clarity before moving decisively on the key policy rates.

 

9.25 am: Economists experts expect the MPC to maintain the status quo on key policy rates today

"...we believe the talks of a reverse repo rate hike in the MPC meeting may be premature as RBI has been largely able to narrow the corridor without the noise of rate hikes and ensuing market cacophony," said an SBI research report.