RBI raises repo rate by 40 basis points to 4.40 pc with immediate effect
Jasleen Kaur
May 4th 2022 03:33 PM
Mumbai, May 4: In a surprise move, the Reserve Bank of India (RBI) on Wednesday increased the policy repo rate by 40 basis points to 4.40 per cent with immediate effect.
Addressing a press conference, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) had unanimously voted to increase the policy repo rate by 40 basis points or 0.40 per cent. The repo rate is the interest rate at which the RBI lends short-term funds to banks.
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[caption id="attachment_630679" align="aligncenter"]
RBI Governor Shaktikanta Das[/caption]
He said the decision was taken in view of rising inflation, geo-political tensions, high crude oil prices and shortage of commodities globally, which have impacted Indian economy.
In his nearly half-an-hour address, the RBI Governor noted that food Inflation is expected to remain high as spillovers from global wheat shortages are impacting domestic wheat prices, even though domestic supplies remain comfortable.
Due to the Russia-Ukraine war, edible oil prices may firm up as major producing countries have imposed export restrictions, he said.
[caption id="attachment_630678" align="aligncenter"]
RBI Governor Shaktikanta Das[/caption]
Based on the assessment of the macroeconomic situation and the outlook, the Monetary Policy Committee voted unanimously to increase the policy repo rate by 40 basis points to 4.40 per cent with immediate effect, Das said.
Also read | Nearly 13 million US children infected with Covid-19
The decision was taken at the unscheduled meeting of the Monetary Policy Committee.
"The MPC continues to be accommodative while focusing on withdrawal of accommodation to ensure that inflation remains within the target going forward," the RBI Governor said.
This is the first increase in the policy repo rate since May 2020.
[caption id="attachment_630677" align="aligncenter"]
The decision was taken in view of rising inflation, geo-political tensions, high crude oil prices and shortage of commodities globally, which have impacted Indian economy.[/caption]
-PTC News
RBI Governor Shaktikanta Das[/caption]
He said the decision was taken in view of rising inflation, geo-political tensions, high crude oil prices and shortage of commodities globally, which have impacted Indian economy.
In his nearly half-an-hour address, the RBI Governor noted that food Inflation is expected to remain high as spillovers from global wheat shortages are impacting domestic wheat prices, even though domestic supplies remain comfortable.
Due to the Russia-Ukraine war, edible oil prices may firm up as major producing countries have imposed export restrictions, he said.
[caption id="attachment_630678" align="aligncenter"] RBI Governor Shaktikanta Das[/caption]
Based on the assessment of the macroeconomic situation and the outlook, the Monetary Policy Committee voted unanimously to increase the policy repo rate by 40 basis points to 4.40 per cent with immediate effect, Das said.
Also read | Nearly 13 million US children infected with Covid-19
The decision was taken at the unscheduled meeting of the Monetary Policy Committee.
"The MPC continues to be accommodative while focusing on withdrawal of accommodation to ensure that inflation remains within the target going forward," the RBI Governor said.
This is the first increase in the policy repo rate since May 2020.
[caption id="attachment_630677" align="aligncenter"] The decision was taken in view of rising inflation, geo-political tensions, high crude oil prices and shortage of commodities globally, which have impacted Indian economy.[/caption]
-PTC News