Status quo on key rates for 10th Time

Policy Stance Remains Accommodative

- Repo rate at 4%

- Reverse repo rate at 3.35%

- Bank Rate at 4.25%

- Domestic growth factors gradually improving

- India's recovery aided by fiscal, monetary support

In India, real GDP growth at 9.2% for 2021-22 takes it modestly above the level of GDP in 2019-20. Private consumption, the mainstay of domestic demand, continues to trail its pre-pandemic level

-Shaktikanta Das, RBI Governor

Mumbai: For the ninth bimonthly policy review in a row, the Reserve Bank of India (RBI) on Thursday continued its accommodation stance and kept key policy rates unchanged. RBI's Monetary Policy Committee (MPC), which decides key policy rates, left repo rate unchanged at four per cent and reverse repo rate retained at 3.35 per cent. Voting was 5-1 on maintaining accommodative MPC stance. Marginal Standing Facility (MSF) and bank rates were kept unchanged at 4.25 per cent.

MPC would retain accommodative stance as long as necessary. Accommodative monetary policy is expected to support economic recovery going ahead.

Continued policy support warranted for durable recovery, the MPC, chaired by the RBI Governor Shaktikanta Das, said.

RB Surveys show good progress in winter crop sowing. There is some loss of momentum in near-term economic growth. RBI projected a 7.8 per cent economic growth in the coming fiscal starting April 1, down from 9.2 per cent expected in 2021-22, in view of uncertainties on account of pandemic and elevated global commodity prices.

Domestic growth factors are gradually improving as India's recovery is supported by fiscal, monetary support. Vaccination drive also helped recover.

The country is set to grow at fastest pace among major economies, as per IMF. India is charting different course of recovery. India is poised to grow at fastest pace among major economies. There is loss of momentum in economic recovery. Demand for contact-intensive services is still muted. However, RBI's surveys show capacity use is rising.

Govt thrust on capex, exports, expected to aid demand policy will provide impetus to invest activity.

Current Account Deficit (CAD) is expected to be contained well below 2 per cent of GDP FY22. High oil prices, non-oil import widened merchandise trade deficit. To extend on-tap liquidity window for healthcare till Jun 30. To extend on-tap liquidity window for contact-intensive Jun 30. RBI will insulate Indian economy from global spillovers. CPI inflation was seen at 5.3 per cent in FY22. CPI inflation is seen at 5.7 per cent in Jan-March. Core inflation is near tolerance testing levels.

The apex bank expects some softening of core inflation. Softening food prices is providing relief on inflation front. Pandemic holds world economy hostage once again as inflation at multi-decade high in several countries, said RBI Governor. Record infections are denting pace of economic activity, he added. Emphasis is shifting to targeted containment strategies, he said, adding, emerging economies vulnerable to global spillover risks.