Highlights of RBI press conference: RBI keeps benchmark repo rate unchanged at 4%

10 Feb 2022 , 10:40 AM

The Reserve Bank of India (RBI) has announced its decision on key interest rates in its sixth and last bi-monthly monetary policy for FY22 at 10 AM. Today the market sentiments will be influenced by RBI’s policy stance, inflation and economic outlook, governor Shaktikanta Das’ speech and other new initiatives in policies. 

The MPC meet started a day back on Tuesday, instead of Monday due to the demise of iconic singer Lata Mangeshkar due to which the Maharashtra government designated a day for mourning.

On expected lines, RBI’s policy repo rate under the liquidity adjustment facility (LAF) is unchanged at 4%. While the reverse repo rate under the LAF remains unchanged at 3.35% and the marginal standing facility (MSF) rate and the Bank Rate at 4.25%.

Highlights of RBI press conference:

• RBI keeps the benchmark repo rate unchanged at 4%. Reverse repo rate remained at 3.35%
• Real GDP growth projected at 7.8% for FY23, RBI governor says. Inflation to peak in Q4FY22, moderate in H2FY23, the governor added.
• CPI inflation moved in close alignment with our projections, RBI says. CPI inflation is projected at 4.5 per cent for 2022-23.
• RBI Governor says real GDP growth of 9.2 per cent in FY22 will take economy above pre-pandemic level.
• VRRR of varying tenors will be conducted whenever warranted and it has become the main option for managing liquidity, Governor Shaktikanta Das says.
• E-rupee prepaid voucher – cap increased to Rs 1 lakh from Rs 10,000, says RBI Governor Shaktikanta
• Food inflation remains elevated. System liquidity remains in large surplus, says Shaktikanta Das
• Our monetary policy will continue to be guided by inflation while ensuring growth, says RBI.
• There could be some softening of core inflation, says RBI Governor Shaktikanta
• MPC of view that continued policy support warranted for durable recovery; need to be vigilant about elevated crude oil prices, says RBI Governor Shaktikanta says
• Governor Shaktikanta says the MPC decided to hold pat on key policy repo rate at 4%. MPC voted 5-1 to continue with the accommodative stance.
• Output barely above pre-pandemic level, says Shaktikanta Das
• India to grow at the fastest pace in world, says RBI Governor
• Inflation at multi-decadal in several countries, says RBI Governor
• India charting different course of recovery than rest of the world; to be fastest growing economy, RBI Governor says
• With effect from March 1, fixed rate reverse repo and MSF operations will be available between 5:30 PM till 11:59 PM on all days, RBI Guv announced.
• Variable rate repo and variable rate reverse repo auctions of 14 days tenor will operate as the main liquidity management tool, RBI says