Reserve Bank of India’s Monetary Policy Committee kept the repo rate unchanged at record low 4%.The Reserve Bank of India’s Monetary Policy Committee (MPC) pegged India’s growth rate at 9.5 per cent for current financial year. However, the central bank said that a hastened pace of the vaccination drive is critical to preserve lives and livelihoods and prevent a resurgence in new waves of infections.”A hastened pace of the vaccination drive and quick ramping up of healthcare infrastructure across both urban and rural areas are critical to preserve lives and livelihoods and prevent a resurgence in new waves of infections,” the Reserve Bank of India said in Monetary Policy Statement.Meanwhile, RBI added that the vaccination process is expected to gather momentum and it will help normalise economy quickly. Citing example of advanced economies the MPC noted that global economic recovery has been powered by massive vaccination programmes and stimulus packages.”Since the MPC’s meeting in April, the global economic recovery has been gaining momentum, driven mainly by major advanced economies (AEs) and powered by massive vaccination programmes and stimulus packages. Activity remains uneven in major emerging market economies (EMEs), with downside risks from renewed waves of infections due to contagious mutants of the virus and the relatively slow progress in vaccination,” RBI noted.”Real GDP growth is now projected at 9.5 per cent in 2021-22, consisting of 18.5 per cent in Q1; 7.9 per cent in Q2; 7.2 per cent in Q3; and 6.6 per cent in Q4:2021-22,” RBI said in a statement.The Reserve Bank of India’s Monetary Policy Committee kept the repo rate unchanged at record low 4 per cent and maintained its accommodative stance. All the MPC unanimously voted to continue with the accommodative stance as long as necessary to revive and sustain growth on a durable basis and continue to mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.
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