Monetary review meeting of Reserve Bank starts from today

RBI MCP: The bi-monthly meetings of the Monetary Policy Committee (MPC) for the new financial year (2024-25) of the Reserve Bank of India started from today. According to an official statement, the monetary review will be announced on April 7. Usually, the members of the six-member committee vote on a proposal on the third day of the meeting and the RBI Governor announces the results of the meeting after the voting is completed. The committee members discuss various topics related to monetary policy in the first two days of the meeting. Experts from related fields present their views. The apex bank has said that after this, the next meeting will be held from 6th to 8th August, then from 7th to 9th October, then from 4th to 6th December and the last meeting will be held in February. It will take place from 5th to 7th February.

The policy rate may again remain the same

The Reserve Bank of India may once again keep the policy rate unchanged in the monetary policy review presented this week. Experts believe that the reason for this could be that with the concerns about economic growth gone and it being around eight percent, the Central Bank is now putting more emphasis on bringing the inflation to the target of four percent. Also, the Monetary Policy Committee (MPC) of RBI, which decides on the policy rate, can take into account the stance of central banks of some developed countries like America and Britain. These central banks are clearly adopting a ‘watch and wait’ approach regarding policy rate cuts. Switzerland is the first major economy among developed countries to cut the policy rate. At the same time, Japan, the world’s third largest economy, has ended the situation of negative interest rates after eight years.

Also Read: World Bank expressed confidence in Indian economy, increased growth rate estimate

What do experts say

Madan Sabnavis, Chief Economist of Bank of Baroda, said that inflation is still in the range of five percent and there is a possibility of future shock on the food inflation front. In view of this, MPC can maintain status quo on policy rate and stance this time too. He said that there may be revision in GDP estimates. Everyone will be eagerly watching this. He said that economic growth in the financial year 2023-24 has been much better than expected and hence the central bank will have less concerns in this matter and will continue to focus more on bringing inflation in line with the target. The country’s economic growth rate stood at 8.4 percent in the December quarter of the financial year 2023-24. The National Statistics Office has revised the GDP growth estimates for the first and second quarters to 8.2 percent and 8.1 percent respectively from the earlier 7.8 percent and 7.6 percent.
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