03 April 2024
Reserve Bank of India (RBI) Governor Shaktikanta Das will unveil the first monetary policy of the financial year 2024-25 on Friday, April 5, after a two-day review meeting, shortly after the conclusion of fiscal 2023-24 (FY24) amid strong macroeconomic indicators. The RBI's rate-setting panel will observe the impact of global headwinds on economic determinants such as the growth in gross domestic product (GDP) and the inflation trajectory.
The review by the six-member Monetary Policy Committee (MPC) led by Das will provide a foreword of the course that the central bank will adopt in the remainder of the new financial year as it seeks to strike a fine balance between sustaining growth and sustaining inflation under the four per cent target.
According to a majority of analysts and economists on D-Street, the RBI would keep its key repo rate unchanged at 6.50 per cent at the conclusion of the April 3-5 MPC meeting, continuing its stance of ‘withdrawal of accommodation’. However, the recent uptick in crude oil prices over geopolitical conflicts is likely to keep the MPC's focus on inflation and managing the impact of global headwinds, despite record-high economic growth in the previous quarter.
"The MPC is unlikely to act on policy rates on April 5th. Even though rate cuts can be expected this year, the time is not yet conducive for a rate cut. The growth momentum in the economy is strong and FY 24 is likely to register GDP growth of 7.6 per cent, much ahead of the initial estimates,'' said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
Reserve Bank of India (RBI) Governor Shaktikanta Das will unveil the first monetary policy of the financial year 2024-25 on Friday, April 5, after a two-day review meeting, shortly after the conclusion of fiscal 2023-24 (FY24) amid strong macroeconomic indicators. The RBI's rate-setting panel will observe the impact of global headwinds on economic determinants such as the growth in gross domestic product (GDP) and the inflation trajectory.
The review by the six-member Monetary Policy Committee (MPC) led by Das will provide a foreword of the course that the central bank will adopt in the remainder of the new financial year as it seeks to strike a fine balance between sustaining growth and sustaining inflation under the four per cent target.
According to a majority of analysts and economists on D-Street, the RBI would keep its key repo rate unchanged at 6.50 per cent at the conclusion of the April 3-5 MPC meeting, continuing its stance of ‘withdrawal of accommodation’. However, the recent uptick in crude oil prices over geopolitical conflicts is likely to keep the MPC's focus on inflation and managing the impact of global headwinds, despite record-high economic growth in the previous quarter.
"The MPC is unlikely to act on policy rates on April 5th. Even though rate cuts can be expected this year, the time is not yet conducive for a rate cut. The growth momentum in the economy is strong and FY 24 is likely to register GDP growth of 7.6 per cent, much ahead of the initial estimates,'' said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
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