Monetary policy: RBI leaves inflation projection for FY24 unchanged at 5.4%, but...
The Reserve Bank of India's (RBI) Monetary Policy Committee unanimously decided to keep the repo rate- key lending rate- unchanged at 6.5 per cent for the fourth time in a row. The rate-setting panel also left the policy stance unchanged with focus on withdrawal of accommodation.
The central bank now sees inflation for Q2, Q3 and Q4 at 6.4%, 5.6% and 5.2%, respectively.
In August policy, the central bank had forecast Q2 inflation at 6.2%, Q3 at 5.7% and Q4 at 5.2% The RBI had then pegged the inflation rate for the first quarter of the next fiscal year at 5.2%.
Overall inflation outlook is clouded by uncertainties by fall in khariff sowing, lower reserve oil levels and volatile global food and energy prices, RBI Governor and MPC Chair Shaktikanta Das said while announcing the policy decisions. Inflation trajectory will be shaped by El Nino and global food and energy prices, he added.
For the last fiscal year, inflation was pegged at 6.5%.
The RBI is determined to bring down inflation to 4% and will remain watchful of risks as more frequent global supply shocks can have profound implications on the management of the price situation, Das had said earlier last month.
Policymakers had also said the key to rein in the inflation rate to control food prices and domestic supplies must go up.
New Delhi has recently restricted exports of rice and sugar and imposed steep taxes on onion shipments to ensure domestic supplies.
However, the global economy’s efforts to counter high inflation also met with the challenge of high crude oil prices.
