ANI
05 Dec 2022, 13:37 GMT+10
New Delhi [India], December 5 (ANI): The Reserve Bank of India's three-day monetary policy committee meeting commences today. Financial markets will be keenly watching the committee's stance as consumer inflation is still above the 6 per cent target band.
"The RBI will be presenting the monetary policy against the backdrop of GDP growth slowing down as well as inflation being high above 6 per cent. We do believe that the MPC will continue with rate hikes this time though the magnitude will be lower - probably 25-35 bps," said Madan Sabnavis, Chief Economist at Bank of Baroda.
More specifically, Sabnavis said it believes that the terminal repo rate for the financial year is expected to be 6.5 per cent, which essentially means there will be one more rate hike in February meeting.
"It is unlikely to change the stance and the withdrawal of liquidity will continue. While the RBI will take a hard look at both the GDP and inflation projections, there could be some downward revision for GDP growth. In short, there will not be any surprise for the market just as is the case for global markets too which are now expecting more moderate increases in interest rates by the Fed," Sabnavis added.
The central bank had already hiked the key policy rate by 190 basis points since May to 5.9 per cent to cool off domestic retail inflation that has stayed above the RBI's upper tolerance limit for over three quarters now. In October, retail inflation was 6.77 per cent.
Under the flexible inflation targeting framework introduced in 2016, the RBI is deemed to have failed in managing price rises if the CPI-based inflation is outside the 2-6 per cent range for three quarters in a row.
An out-of-turn meeting of the Monetary Policy Committee (MPC) of the Reserve Bank of India was held in early November to discuss and draft the report to be sent to the central government for having failed in maintaining the inflation mandate.
The meeting was called under Section 45ZN of the Reserve Bank of India (RBI) Act 1934, which pertains to steps to be taken if the central bank fails to meet its inflation-targeting mandate.
Further details about the special meeting are not officially in the public domain. (ANI)
Get a daily dose of Central Asia Times news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Central Asia Times.
More InformationOUAGADOUGOU, Burkina Faso: As Burkina Faso, in western Africa, faces an Islamist insurgency, it is set to end a military ...
TOKYO, Japan: Japanese Prime minister Fumio Kishida said this week that it was "now or never" for Japan, one of ...
WASHINGTON D.C.: As part of its efforts to simplify the national COVID-19 vaccine strategy, the US Food and Drug Administration ...
WASHINGTON D.C.: US authorities said this week that a surge in Cubans and Nicaraguans arriving at the US border with ...
OTTAWA, Canada: Canadian Prime Minister Justin Trudeau's Liberal government plans to implement its long-awaited workforce transition bill, the "Just Transition," ...
TOKYO, Japan: The Yomiuri newspaper has reported that Japanese Prime Minister Fumio Kishida is planning to visit Kyiv in February ...
TOKYO, Japan: Japanese Prime minister Fumio Kishida said this week that it was "now or never" for Japan, one of ...
BANGKOK, Thailand: Following China's reopening and the end of its strict COVID-19 restrictions, businesses on Thailand's holiday island of Phuket ...
DHAKA, Bangladesh - The United States Agency for International Development (USAID) is committing an additional $75 million in humanitarian aid ...
KATHMANDU, Nepal - On Tuesday, a 37-year-old man died after setting himself on fire in front of the Parliament building ...
ISLAMABAD, Pakistan - Pakistan's intelligence and security agencies have revealed the script for a false flag operation involving alleged infiltration ...
TOKYO, Japan: The Yomiuri newspaper has reported that Japanese Prime Minister Fumio Kishida is planning to visit Kyiv in February ...