RBI keeps repo rate unchanged at 6%. The Reserve Bank of India's fourth bi-monthly monetary and credit policy review comes at a time when the government is grappling with a slowing economic growth, whereas the central bank is staring at a rising headline inflation.
The Reserve Bank of India’s fourth bi-monthly monetary and credit policy review comes at a time when the government is grappling with a slowing economic growth, whereas the central bank is staring at a rising headline inflation. To balance the often polar opposite requirements to deal with both the situations is perhaps the most challenging task before the central banks of developing economies such as India. In today’s policy review as well, RBI’s Monetary Policy Committee will likely face this dilemma. It remains to be seen if the MPC will keep its single-point focus on targeting the inflation, leaving the economic growth to be handled by the government. Here are live updates:
3.22 pm: RBI Governor Urjit Patel says high frequency indicators indicate uptick in economic growth
3.21 pm: RBI Deputy Governor BP Kanungo says targeting active consolidation of state debt via buybacks, switches.
3.17 pm: Sensex welcomes RBI’s move to keep repo rates unchanged, tops 31,750 mark: The key equity benchmark index Sensex appraised the move of Reserve Bank of India as the central bank has kept the key repo rates unchanged in its latest bi-monthly monetary policy committee meeting.
3.16 pm: RBI Deputy Governor Viral Acharya says deleveraging corporate sector could take 12-18 months.
3.15 pm: RBI to issue peer-to-peer lending norms today
3.14 pm: RBI Deputy Governor Viral Acharya says oil price risks and global market volatility have risen, adding that there may not be much room for monetary policy adjustment.
3.12 pm: RBI Governor Urjit Patel says, services sector is showing a healthy growth rate; cyclical upturn in growth could be seen in next two quarters.
3.08 pm: Deputy Governor BP Kanungo says government, RBI have been trying to broaden participation in the G-sec market, while targeting active consolidation of state debt via buybacks, switches
3.03 pm: RBI Governor Urjit Patel says corporate credit risk profile is showing gradual signs of improvement
3.01 pm: RBI says state farm loan waivers may result in fiscal slippages; state farm loan waivers may undermine quality of public spend.
3.00 pm: RBI says working toward resolution of banks’ stressed corp exposure; recapitalising PSU banks to ensure growth impulse not restrained.
3.00 pm: Repo rate unchanged as expected; ‘neutral’ stance kept to limit inflation at 4%: The RBI had a little room to cut rates from the point of view of inflation, which recently started inching up and might settle within 3.8%-4.5% range for rest of FY18.
2.58 pm: RBI says remains committed to improving transmission by banks
2.55 pm: States’ farm loan waivers may result in fiscal slippages
2.51 pm: Real gross value added growth seen at 6.4% for July-September, 7.1% for October-December, 7.7% for January-March, and at 7.4% for the next entire financial year FY2018-19.
2.50 pm: MPC expects inflation to rise from its current levels to 4.2-4.6% in the second half of this fiscal.
2.49 pm: RBI Governor Urjit Patel says that household consumption demand may get a boost from a revision in allowance for government employees.
2.48 pm: RBI Governor Urjit Patel says manufacturing weakness persisting
2.46 pm: Core CPI inflation so far is somewhat higher than expected
2.45 pm: MPC says it’s imperative to reinvigorate investment activity, adding that GST-related teething problems may get resolved soon and growth is expected to accelerate in Oct-Mar.
2.41 pm: MPC voted 5-1 in favour of status quo on repo rate. MPC member Dholakia sought at least 25 bps cut in Repo rate.
2.40 pm: RBI says MPC is committed to keep CPI inflation close to 4% on durable basis
2.37 pm: HTM limit to be cut to 19.5% in phases
2.35 pm: CPI inflation seen at 4.2% in Oct-Dec quarter; 4.6% in Jan-Mar quarter, RBI says
2.33 pm: RBI cuts SLR by 50 basis points to 19.5% effective from October 14 fortnight
2.31 pm: Monetary Policy Committee maintains stance as ‘Neutral’
2.30 pm: RBI keeps repo rate unchanged at 6%, as expected.
2.00 pm: RBI should cut rates in today’s policy review, but here’s why it may not: The Reserve Bank of India has many reasons, as experts say, to cut rates at its bi-monthly Monetary Policy Committee (MPC) meeting on Wednesday, but the central bank has one major reason to not cut rates. The clamour for rate cuts had begun on the back of slow economic growth, for which the government has not put forth any fix yet.
1.00 pm: Why cutting rates may not be the solution to spurring GDP growth: RBI October policy review: It would be worthwhile to introspect if further rate cuts would translate to higher growth readily. Much of the discussion within the RBI and MPC will likely be around the growth-inflation dynamics. It will be important to note that the economy has seen a significant supply shock. In face of a supply-side shock, pump-priming the demand side with fiscal “stimulus” or through large rate cuts is unlikely to be a solution.
11.00 am: CII calls for 100 bps rate cut: Ahead of the RBI’s monetary policy announcement, industry body CII pitched for an “out of the box” intervention in the form of a 100 basis points cut in the key interest rate to spur private sector investments.
5.00 am: Bond yields remain steady as market expects dovish tone in RBI monetary policy review: A day ahead of the policy, the benchmark yield closed one basis point lower at 6.65% as the market anticipates the Reserve Bank of India (RBI) to hold rates while signalling a dovish tone.