{"id":5017,"date":"2023-10-07T22:14:58","date_gmt":"2023-10-07T16:44:58","guid":{"rendered":"https:\/\/yourcareerheights.com\/?p=5017"},"modified":"2023-10-07T22:14:58","modified_gmt":"2023-10-07T16:44:58","slug":"rbis-bi-monthly-review-meeting-6th-october-2023-key-highlights","status":"publish","type":"post","link":"https:\/\/yourcareerheights.com\/?p=5017","title":{"rendered":"RBI’s Bi-Monthly Review Meeting 6th October 2023 – Key Highlights"},"content":{"rendered":"
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\"\"<\/a>The Monetary Policy Committee (MPC) met on 4th, 5th and 6th October 2023. After a detailed assessment of the evolving macroeconomic and financial developments and the outlook, it decided unanimously to keep the policy repo rate unchanged at 6.50 per cent<\/em><\/strong>. Consequently, the standing deposit facility (SDF) rate remains at 6.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 6.75 per cent. The MPC also decided by a majority of 5 out of 6 members to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth<\/em><\/strong>.<\/h3>\n

MPC\u2019s rationale for these decisions:<\/strong><\/h4>\n

Headline inflation had surged in July,it corrected partly in August and is expected to see further easing in September on the back of moderation in these prices. A silver lining amidst all these is declining core inflation. The overall inflation outlook, however, is clouded by uncertainties from the fall in kharif sowing for key crops like pulses and oilseeds, low reservoir levels, and volatile global food and energy prices. The MPC observed that the recurring incidence of large and overlapping food price shocks can impart generalisation and persistence to headline inflation. Economic activity, on the other hand, has remained resilient. Taking into account the evolving inflation-growth dynamics and the cumulative policy repo rate hike of 250 basis points which is still working through the economy, the MPC decided to keep the policy repo rate unchanged at 6.50 per cent in this meeting. The transmission of the 250 basis points (bps) increase in the policy repo rate to bank lending and deposit rates is still incomplete and hence the MPC decided to remain focused on withdrawal of accommodation.2<\/a><\/sup>\u00a0The MPC remains highly aIert and prepared to undertake timely policy measures, as may be necessary, in order to align inflation to the target and anchor inflation expectations.<\/p>\n

Global Economy v\/s Domestic Economy:<\/strong><\/p>\n

Global growth is losing momentum. Inflation is easing gradually but remains well above target in major economies.<\/strong><\/em> Concerns about higher for longer rates are imparting volatility to global financial markets. Sovereign bond yields have hardened, the US dollar has appreciated, and equity markets have corrected.<\/strong> Emerging market economies (EMEs) are experiencing currency depreciation and volatile capital flows.<\/strong><\/em> The global economy is slowing under the impact of tight financial conditions, protracted geopolitical tensions and increasing geoeconomic fragmentation. Global trade is contracting.3<\/a><\/sup> Headline inflation is easing but rules above the target in major economies.<\/p>\n

In contrast to global trends, domestic economic activity exhibits resilience on the back of strong domestic demand.<\/em><\/strong><\/h4>\n

The latest RBI policy review\u00a0comes at a time when major central banks around the globe continue to struggle against red-hot inflation trying not to damage the pace of growth.<\/span><\/strong><\/p>\n

Highlights of the Monetary Policy:<\/strong><\/h4>\n