The Monetary Policy Committee (MPC) met on 5th, 6th and 7th April, 2021 and deliberated on current and evolving macroeconomic and financial developments, both domestisocial things c and global.
The Reserve Bank of India's (RBI's) six-member monetary policy committee, headed by Governor Shaktikanta Das, announced the outcome of its bi-monthly monetary policy review today ie on 7th April 2021. Due to the rise in the spread of coronavirus and the imposition of fresh restrictions to contain the virus spread, the RBI decided to maintain status quo on the benchmark repo rate — the rate at which the central bank lends short-term funds to banks — at 4 per cent. It also kept the accommodative monetary stance unchanged today to nurture a fragile economic recovery.
The policy announcement, the first for the fiscal, will come days after the government maintained the RBI's target to ensure inflation to be within 2-6 per cent band for five more years. Policy repo rate or the short-term lending rate is currently at 4%, and reverse repo rate 3.35%.
Here are the KEY HIGHLIGHTS of RBI Monetary Policy 2021 and top 11 points by Governor Shaktikanta Das:-
1 RBI maintains status quo fifth time in a row on policy rate; keeps repo unchanged at 4%
2 Central bank to maintain accommodative monetary policy stance to support growth, keep inflation at targeted level: RBI Guv
3 Recent surge in COVID-19 infections has created uncertainty over economic growth recovery, says RBI Governor.
4 Focus must be on containing spread of virus and economic recovery, says RBI Guv
5 RBI retains economic growth for 2021-22 fiscal at 10.5 per cent in 2021-22 fiscal's first monetary policy
6 Central Bank to ensure ample liquidity in system so that productive sector gets adequate credit
7 RBI to ensure orderly conduct of government borrowing; preserve financial stability
8 RBI will continue to do whatever it takes to preserve stability and to insulate financial firms from global spillovers
9 RBI announces Rs 50,000 cr additional liquidity facility to NABARD, NHB and SIDBI for fresh lending during 2021-22
10 RBI enhances aggregate ways and means advances limits to states to Rs 47,010 crore.
11 To tide over COVID crisis, RBI extends enhanced interim ways and means advances of Rs 51,560 crore to states till September.
12 In order to maintain adequate liquidity, for the year 2021-22, RBI decided to put in place what is termed as a secondary market G-sec acquisition programme or G-SAP 1.0, to give it a distinct character. The first purchase of government securities for an aggregate amount of ₹25,000 crore under G-SAP 1.0 will be conducted on April 15, 2021.
Please click here for :Governor’s Statement, April 7, 2021 & Resolution of the Monetary Policy Committee (MPC) April 5-7, 2021
source: rbi.org.in, Indian Express, Business Standard, Business Line