RBI Monetary Policy February 2023 Live: MPC likely to raise repo rate 25 bps, Shaktikanta Das may pause further hikes | The Financial Express

RBI MPC Highlights: Repo rate hiked by 25 bps, maintains ‘Withdrawal of Accommodation’, says further action warranted

RBI Monetary Policy 2023 Highlights: RBI said they could be open to more tightening, as core inflation remained high.

RBI Monetary Policy | RBI MPC Preview | RBI MPC Meeting |
RBI Monetary Policy 2023: RBI maintains their withdrawal of accommodation stance.

RBI MPC Meet 2023 Highlights: The Reserve Bank of India hiked its key repo rate by 25 basis points on Wednesday as expected but surprised markets by leaving the door open to more tightening, saying core inflation remained high. The central bank said that its policy stance remains focused on the withdrawal of accommodation. Most analysts had expected a hike on Wednesday to be the final increase in the RBI’s current tightening cycle, which has seen it raise rates by 250 bps since May last year.

Live Updates
14:09 (IST) 8 Feb 2023
RBI MPC: Impact on bond market

“With Repo Rate anchored at 6.5%, benchmark 10-year IGB yield is expected to trade in a range of 7.25 to 7.5% in the medium-term in our view. We expect sovereign yield curve to steepen in FY24 amid demand-supply dynamic on the long-end. Credit spreads are also expected to widen gradually in FY24 amid continued growth in credit off-take and adverse liquidity conditions in global markets for fund raising.”

Edelweiss Mutual Fund

13:24 (IST) 8 Feb 2023
RBI MPC: Expansion of TReDS will improve cash-flows

“Expansion of TReDS will further improve cash-flows to the MSMEs. Enable UPI to inbound travellers to India will showcase the potential of UPI to the world and promote cashless economy. Discussion papers on Penal charges on loans will bring more uniformity in aligning of charges, reduction of customer grievances and will bring better credit discipline. Impetus for climate risk & sustainable finance will further strengthen the banking sector.”

– Shanti Lal Jain, MD & CEO, Indian Bank

12:21 (IST) 8 Feb 2023
RBI MPC: Guv on Indian banks

RBI has taken a number of steps to strengthen resilience of Indian banks: RBI Guv Shaktikanta Das

12:10 (IST) 8 Feb 2023
RBI MPC: Inflation moderating

Inflation shown signs of moderation, worst is behind us: RBI Guv Shaktikanta Das

11:15 (IST) 8 Feb 2023
RBI MPC: Rupee update

Rupee was trading flat at 82.69 per dollar. Since the markets already priced in 25 bps repo rate hike by the RBI MPC, there was no major impact on currency after the monetary policy decision.

10:53 (IST) 8 Feb 2023
RBI MPC: Optimism good news for equity markets

“The Governor stressed the fact that the credit growth in the economy is 16.7% YoY in January. Optimism regarding FY24 GDP growth and containing the CPI inflation at 5.3% is good news for the equity markets even in the context of unabated selling by FIIs.”

V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services

10:50 (IST) 8 Feb 2023
RBI MPC: RBI influenced by foreign central banks

“The RBI seems to have been more bothered about the high and sticky core inflation for more than a year. More importantly, the continued rate hikes by the Bank of England, the ECB and the U.S. Federal Reserves, and the implications of these in the foreign exchange markets, influenced the decision of the RBI.”

– Sujan Hajra, Chief Economist and Executive Director, Anand Rathi

10:48 (IST) 8 Feb 2023
RBI MPC: Rate hike could protect rupee from depreciation

“Rate hike of 25 bps would likely protect rupee from further depreciation and thus control import driven inflation, thereby balancing both domestic and external factors for sustainable growth of 6.5% plus year ahead.”

– Umesh Kumar Mehta, CIO, SAMCO MF

10:47 (IST) 8 Feb 2023
RBI MPC: Rate hikes to increase EMI burden

“According to the RBI Governor, inflation is likely to stay at 5.6% for 4QFY23, and expected to stay above 4% in FY24. The rate hikes are likely to raise the EMI burden for floating rate linked loans. However, the bank’s NIMs are likely to stay stable as an increasing proportion of EBLR linked loans.”

Ajit Kabi, Banking Analyst, LKP Securities.

10:46 (IST) 8 Feb 2023
RBI MPC: System liquidity at comfortable levels

“Unless inflation goes out of control, we do not expect RBI to hike rates from current levels. The macroeconomic indicators are strong, and most data points are signaling ample demand in the system. The system liquidity is at comfortable levels thereby creating ample funding avenues for credit-worthy borrowers.”

– Cyrus Mody, Managing Partner, Viceroy Properties

10:44 (IST) 8 Feb 2023
RBI MPC: Could see rate reduction

“RBI-MPC voted to increase the repo rate by 25 basis points to 6.5% this seems to be final rate hike with inflation under control in coming days which is targeted for 4% in 2024, we could see rate reduction in later part of this year. There can cheer in the capital markets.”

– Narinder Wadhwa, President, CPAI

10:41 (IST) 8 Feb 2023
RBI MPC: Further action warranted

Core inflation remains elevated, and further calibrated policy action warranted: RBI Guv Shaktikanta Das

10:38 (IST) 8 Feb 2023
RBI MPC: UPI can be used by travelers

UPI extended for inbound travelers in India. All inbound travelers from G20 can use UP for merchant payments: RBI Guv Shaktikanta Das

10:36 (IST) 8 Feb 2023
RBI MPC: Indian rupee least volatile

Indian rupee remained least volatile among its Asian peers in 2022 and so far this year: RBI Guv Shaktikanta Das

10:35 (IST) 8 Feb 2023
RBI MPC: CAD to moderate

Current account deficit to moderate in second half of 2022-23 and remain eminently manageable: RBI Guv Shaktikanta Das

10:32 (IST) 8 Feb 2023
RBI MPC: Live Updates

Smaller rate cut provides elbowroom to weigh incoming data, forecasts: RBI Governor Shaktikanta Das.

10:31 (IST) 8 Feb 2023
RBI MPC: CPI inflation

The CPI inflation for FY24 is seen at 5.3%: RBI MPC Shaktikanta Das

10:26 (IST) 8 Feb 2023
RBI MPC: G-Sec update

The borrowing and lending of G-Secs has been proposed. Government bond market timings restored to 9 am to 5 pm: Guv Shaktikanta Das

10:25 (IST) 8 Feb 2023
RBI MPC: Retail inflation

Retail inflation expected to average 5.6% in Q4FY23: Guv Shaktikanta Das

10:20 (IST) 8 Feb 2023
RBI MPC: FY23 Inflation projection cut

FY23 inflation projection cut 6.5% from 6.7%: RBI Guv Shaktikanta Das

10:19 (IST) 8 Feb 2023
RBI MPC: Must remain unwavering

Headline inflation moderated, but stickiness of core inflation is a matter of concern. We have to remain unwavering in our commitment to bring down CPI: RBI Guv Shaktikanta Das

10:18 (IST) 8 Feb 2023
RBI MPC: Indian economy remains resilient

Available data for Q3 and Q4 for currently financial year shows Indian economy remains resilient: Guv Shaktikanta Das

10:16 (IST) 8 Feb 2023
RBI MPC: FY24 real GDP growth – 6.4%

Real GDP growth is projected at 6.4% for FY24

FY24 quarterly GDP growth estimates:

Q1FY24 – 7.8%

Q2FY24 – 6.2%

Q3FY24 – 6%

Q4FY23 – 5.8%

– Guv Shaktikanta Das

10:11 (IST) 8 Feb 2023
RBI MPC: Core inflation

Core inflation remains sticky, to keep strong vigil on inflation outlook. Inflation for Q4FY23 seen at 5.6%: RBI Guv Shaktikanta Das

10:09 (IST) 8 Feb 2023
RBI MPC: Real GDP growth

The FY23E real GDP growth rate seen at 7%.

10:06 (IST) 8 Feb 2023

The RBI MPC maintained their stance from “Withdrawal of Accommodation” by a 4:2 majority: Guv Shaktikanta Das

10:05 (IST) 8 Feb 2023

The RBI MPC decided to raise the current repo rate by 25 bps from 6.25% to 6.5%. Decided by 4:2 majority: Guv Shaktikanta Das

10:05 (IST) 8 Feb 2023
RBI MPC: Monetary policy faced with unprecedented contractions

“In contrast to the moderation era of the nineties, monetary policy was faced with unprecedented contractions and surge in global inflation.” – Guv Shaktikanta Das

10:02 (IST) 8 Feb 2023

RBI Governor Shaktikanta Das begins his address.

09:41 (IST) 8 Feb 2023
Watch out for MPC split and stance

“The possibility of an MPC split (4-2 or even 3-3 with a Governor veto) in the upcoming meeting is not ruled out. The last MPC minutes saw the two diverging members argue that:

(1) India has limited evidence of a wage-price spiral or demand-led inflation

(2) that the current policy rate is sufficient for inflation to glide back to the target.”

– Madhavi Arora, Lead – Economist, Emkay Global Financial Services

09:32 (IST) 8 Feb 2023
MPC decision unlikely to have effect on markets

“The MPC is likely to raise policy rates by 25 bp today. This is known to the market and is unlikely to have any meaningful impact on the market. The important trends impacting markets globally are the developments in the US economy and rate action by the Fed.”

– V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services

09:12 (IST) 8 Feb 2023
Expect reversal in rates next year

“Given, how well the RBI has controlled inflation in recent months, we anticipate that it will soon align with the government's preference for growth. This week a status quo is expected or at the best, one last hike and then rate hikes could be paused. We anticipate a halt in interest rate hikes in the subsequent next months, followed by the reversal in rates starting next year.”

– Umesh Kumar Mehta, CIO, SAMCO MF

09:08 (IST) 8 Feb 2023
Inflation forecast could be revised

“The RBI may mildly revise down its inflation forecast for FY24, even as it would re-emphasize the near-term stickiness of core inflation. We see FY24 average headline/core inflation at 5.2%/5.0%.”

– Madhavi Arora, Lead – Economist, Emkay Global Financial Services

09:03 (IST) 8 Feb 2023
Last hike could push real repo rate into positive

“While the MPC’s decision is finely balanced between a pause and a 25 bps hike, we expect the MPC to hike by a last 25 bps to push the real repo rate comfortably into positive. This would help the RBI to be on a prolonged pause as it assesses the lagged impact of the past rate hikes and input price movements, evolution of the global and domestic demand conditions, and behaviour of global central banks.”

– Suvodeep Rakshit Senior Economist, Kotak Institutional Equities

08:57 (IST) 8 Feb 2023
Inflation could average around 5.2%

“The RBI MPC will view the recent inflation prints favourably. 3QFY23 CPI inflation at 6.1% is around 50 bps lower than RBI’s estimate and 4QFY23 inflation is also likely to be 20-30 bps lower than RBI’s estimate. We estimate inflation to average around 5.2% over the next 12-15 months. The real repo rate would be positive by around 100 bps at the current level.”

– Suvodeep Rakshit Senior Economist, Kotak Institutional Equities

08:55 (IST) 8 Feb 2023
Real estate demand may offset rate increase impact

“The MPC is likely to maintain its stance of “withdrawal of accommodation” and ease the pace of rate increases by RBI hiking rates by 25bps in Feb. Housing credit growth has been leading retail credit growth, rising by over 15%. As the market sentiment in the real estate sector in non-metro markets remains strong, demand is likely to offset the rate increase impact.”

– Ravi Subramanian, MD & CEO, Shriram Housing Finance

08:54 (IST) 8 Feb 2023
Moderation in pace of repo rate hike is pertinent

“With inflation coming under control and reduced pace of US Fed rate hike, the focus of the RBI is now likely to shift towards maintaining growth, which can moderate in the coming financial year owing to global uncertainties. Thus, moderation in the pace of repo rate hike is pertinent to keep domestic demand afloat to support the economy.”

– Vivek Rathi, Director Research, Knight Frank India

First published on: 08-02-2023 at 08:51 IST