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PremiumRBI MPC Meeting 2024 Highlights: The Reserve Bank of India (RBI) Governor Shaktikanta Das on Friday announced the first monetary policy of the financial year 2024-25. The two-day review meeting of the RBI's Monetary Policy Committee (MPC), the rate-setting panel, commenced on April 3 and concluded today, April 5. The RBI decided to keep the key policy repo rate unchanged at 6.5% for the seventh consecutive time. The six-member MPC headed by Governor Das also decided to maintain the policy stance at ‘withdrawal of accommodation’. The RBI has projected India’s real GDP growth rate for FY25 at 7%. CPI inflation for FY25 is estimated at 4.5%. Stay tuned to our RBI MPC Meeting 2024 Live Updates here:
RBI MPC Meeting 2024 Highlights: The RBI Governor Shaktikanta Das announced the first monetary policy of FY25. Here are the key highlights of RBI April policy:
Policy Measures:
Non-policy measures:
RBI MPC Meeting 2024 Live: While the RBI does remain cautious on the inflation front, we believe moderating inflationary pressures, coupled with the realization of normal monsoon may open up the possibility of rate cuts by the RBI in the first half of fiscal 2024-25. We are encouraged by the resilience of the global economy, continued economic growth momentum in India, coupled with relative rupee stability. Steady pick up in investment activity and strengthening of rural demand conditions bode well for the economy and further fuels our optimism towards steady demand for gold loans, vehicle loans and home loans during the year, said George Muthoot, MD, Muthoot Finance.
RBI MPC Meeting 2024 Live: We expect rate cuts in the third quarter of FY25, possibly after the US FOMC starts rate cut cycle. RBI is expected to keep liquidity neutral so that further transmission of higher rates can continue. There is a possibility of modification of the LCR framework going forward which may augur well for bonds, said Parijat Agrawal, Head – Fixed Income, Union Mutual Fund.
RBI MPC Meeting 2024 Live: Despite elevated crude prices & food inflation, several comments like “Goal in sight" & “Elephant has gone to Forest" gives a dovish tilt on inflation. Fundamental factors remain healthy as reflected in FY25 GDP at 7%, manageable CAD and record high Fx reserve. Overall, it doesn’t disrupt the expectations of rate cuts in 2HCY2024, in line with the global rate cut cycle. Market focus will be back to fiscal demand-supply dynamics which looks extremely favorable with Govt’s rapid fiscal consolidation over next 2 years, FPI inflows and particularly light G-Sec borrowing calendar in 1HFY25, said Vikas Garg – Head of Fixed Income, Invesco Mutual Fund.
RBI MPC Meeting 2024 Live:We maintain our view of a shallow rate-cut cycle of 75-100 bps in FY25. Private consumption growth has slowed considerably, and this weakness is also reflected in the series-low core CPI. Hence, RBI could consider changing the policy stance to neutral in the June or August meeting. However, RBI will likely continue to be cautious regarding rate cuts, given the uncertainty around food inflation. Much now relies on how the monsoon season pans out, said Vikram Chhabra, Senior Economist, 360 ONE Asset.
RBI MPC Meeting 2024 Live: RBI’s maintenance of status quo on the repo rate and the policy stance marked by ‘withdrawal of accommodation’ is a prudent decision amidst increasing geopolitical uncertainties and any adverse climate impact. Room for monetary policy easing could emerge in the coming months if inflation glides lower along the projected trajectory. Additionally, the flexibility allowed to SFBs to manage interest rate risk through use of permissible interest rate derivatives is a welcome step, said Sanjay Agarwal, Founder, MD & CEO, AU Small Finance Bank.
RBI MPC Meeting 2024 Live: The RBI Governor is playing like Brian Lara at Antigua Ground. After scoring 375 runs, the highest score in a test match, he scored 400 runs to better that. The RBI has achieved the objective of Stability, Trust and Growth. Financial markets in stable conditions. The market trusts the RBI to lower the Inflation to midpoint. Growth is higher than market expectations. Expect the RBI to maintain the motto of Stability, Trust and Growth in the markets, said Nilesh Shah, MD, Kotak Mahindra AMC.
RBI MPC Meeting 2024 Live: Despite the Reserve Bank of India (RBI) Governor Shaktikanta Das expressing optimism regarding domestic growth, consumption recovery, and easing inflation, the domestic market sentiment stayed subdued on Friday. Equity benchmarks the Sensex and the Nifty 50 were down by about 0.10% each around 1 pm after the RBI announced a status quo on the repo rate and policy stance. Read full report here
RBI Deputy Governor T. Rabi Sankar said that the central bank was examining comments received on Self-Regulatory Organisations (SRO) for the Fintech sector and would come out with a framework.
Governor Shaktikanta Das said he expects to release the framework on SRO for the Fintech sector before April.
RBI MPC Meeting 2024 Live: RBI’s supervision machinery is regularly supervising banks and NBFCs. Where we see major deviations in regulations, we first engage with those entities and direct them to take corrective actions. We apply supervisory restrictions only in outlier cases. There is no system-wide problem.
RBI MPC Meeting 2024 Live: We are building gold reserves and that is a part of our reserve deployment, says RBI Governor Das.
RBI MPC Meeting 2024 Live: Further rate action is linked to the evolving path of inflation. RBI monetary policy is guided and determined by domestic situations, said RBI Governor Shaktikanta Das.
RBI MPC Meeting 2024 Live: RBI policy on foreign exchange risk management has remained consistent over the last few years and there is no change in policy approach. It is only for hedging and is a mandatory requirement to have underline exposure. There are some market participants misusing the relaxation by assuming that it is tantamount to no underlying and that is a violation of the law, said RBI Deputy Governor Patra
RBI MPC Meeting 2024 Live: The Reserve Bank of India (RBI) Governor Shaktikanta Das said the task on inflation not done yet.
Moving towards RBI@100, primary focus will be on financial stability and promoting the financial sector. The priority of RBI is to ensure stability of Rupee. Financial sector continues to be stable, he added.
RBI Governor Shaktikanta Das addresses the media after the announcement of monetary policy. Watch RBI Governor’s post-policy presser here
RBI MPC Meeting 2024 Live: While there was some anticipation of rate cuts by the end of 2024, the RBI seems inclined to adopt a wait-and-see approach before initiating a rate cut cycle. The central bank's current neutral policy stance appears designed to mitigate risks without unduly unsettling the debt and equity markets. This strategy highlights the RBI's priority to balance growth with inflation control, acknowledging the significant weight of volatile food components in India's retail inflation basket and the potential impact of global oil price fluctuations, said Sujan Hajra, Chief Economist & Executive Director, Anand Rathi Shares and Stock Brokers.
RBI monetary policy 2024: In its first bi-monthly committee meeting for FY24–25, the Reserve Bank of India (RBI) maintained the real GDP growth forecast for the current fiscal year at 7%.
The GDP growth target for Q1 FY25 was adjusted to 7.1% from the previous 7.2%, while for Q2 FY25, it was revised to 6.9%, up from the previous forecast of 6.8%. The growth rate for Q3 FY24 remains unchanged at 7% from previous forecasts. In the final quarter of the fiscal year, the RBI revised the growth rate to 7% from the previous 6.9%. Read full report here
RBI MPC Meeting 2024 Live: RBI has a view that domestic growth momentum led by rural recovery, private capex and government investment will remain strong into the year, and inflation is also expected to remain moderated. However the key headline risk is coming from rising geo-politics which is also getting evidenced in rising crude prices. The impact on inflation from the above two factors warrant a watch and staying cautious on the policy, said Anitha Rangan, Economist, Equirus.
On liquidity, RBI is likely to continue with the current tools of VRR and VRRR to manage deficit and surplus in the system. Ahead of the bond inclusion, RBI is not doing anything different to change the dynamics of policy actions or liquidity management. In summary, RBI is not lowering the guard while inflation aligns to the target, Rangan added.
RBI MPC Meeting 2024 Live: The decision to pause along with no change in stance was in line with our expectation. Expectedly, the focus of the MPC remained on ensuring disinflation on a sustained basis in order to achieve their medium term inflation target of 4%. The RBI does not seem to be too worried about the liquidity situation. We expect the RBI to continue to focus on fine-tuning of liquidity conditions through VRR/VRRR auctions, in order to align the overnight rates with the repo rate, said Suvodeep Rakshit, Senior Economist, Kotak Institutional Equities.
The RBI has enough space for holding repo rate steady, with its FY2025 GDP growth being quite strong at 7% in order to target the 4% inflation mark. We continue to expect a shallow rate cut cycle from Q3FY25 onwards with the stance changing to neutral in the end-Q2FY25 or along with the rate action, he added.
RBI MPC Meeting 2024 Live: Dr. Shashanka Bhide, Dr. Ashima Goyal, Dr. Rajiv Ranjan, Dr. Michael Debabrata Patra and Shri Shaktikanta Das voted to keep the policy repo rate unchanged at 6.50% and remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth.
Prof. Jayanth R. Varma voted to reduce the policy repo rate by 25 basis points and to change stance to ‘Neutral’.
As we expected, the MPC policy took recognition of fluidity of global narratives, even has domestic dynamics have stayed favorable. This suggests that when needed, the aim of financial stability may even precede inflation management. We have long maintained that the RBI policy has been somewhat pegged to the Fed, specifically over the last two years, even as it formally targeted inflation. This seems fair, as external dynamics have been fluid, implying that the policy prerogative needs to be flexible for ensuring financial stability. The fluidity of global narratives and policy repricing, in conjunction with the near-term problem-of-plenty on INR/bonds, could make it arduous for the RBI to find a balance in its policy biases, said Madhavi Arora, Lead Economist, Emkay Global Financial Services.
Thus we maintain the RBI’s tone will slowly tiptoe to ‘Gracklish’ from the usual ‘Hawk-Dove’ signaling, implying a non-committal stance and limited definite forward guidance ahead. While bull-steepening of India bonds looks to be a popular trade, consistent repricing of Fed cuts could spill over into the RBI’s reaction function and will be cyclically noisy for bonds/FX, Arora added.
The Indian stock market traded flat after the Reserve Bank of India (RBI) announced its monetary policy, maintaining a status quo as widely expected. RBI kept the key repo rates unchanged and stance at ‘withdrawal of accommodation’.
The Sensex traded 47.93 points, or 0.06%, lower at 74,179.70, while the Nifty 50 was down 12.90 points, or 0.06%, at 22,501.75. Broader markets outperformed the benchmark indices as the Nifty Midcap 100 and the Nifty Smallcap 100 indices gained over half a percent each. Catch Stock Market Live Updates here
On expected lines, the Reserve Bank of India (RBI) Governor Shaktikanta Das confirmed on Friday, April 5, that the key policy repo rate would be maintained at 6.5 per cent. A majority of analysts and economists expected the RBI to maintain its policy rate and stance considering India's strong economic growth and sticky inflation. Food prices remain an overhang and the RBI remains focussed on bringing inflation below 4 per cent. Read full report here
RBI MPC Meeting 2024 Live: The Central Bank Digital Currency (CBDC) pilots are currently in operation with increasing number of use-cases and participating banks. It is proposed to make CBDC-Retail accessible to a broader segment of users by enabling non-bank payment system operators to offer CBDC wallets. This will also facilitate testing of the resiliency of CBDC platform to handle multi-channel transactions, RBI Governor Das said.
In order to make cash handling at banks easier, RBI proposed to facilitate cash deposits at cash deposit machines using UPI. Read here
RBI Governor also said that the central bank will also notify investment and trading of sovereign green bonds in IFSC.
RBI MPC Meeting 2024 Live: RBI Governor Shaktikanta Das announced to launch a mobile application for access to RBI’s Retail Direct Scheme for participation in the G-sec market.
RBI MPC Meeting 2024 Live: Banks, NBFCs and other financial entities must continue to give the highest priority to quality of governance and adherence to regulatory guidelines. Financial sector players, by and large, operate with public money – be it of depositors in banks and select NBFCs or investors in bonds and other financial instruments. They should always be mindful of this. The Reserve Bank will continue to constructively engage with financial entities in this regard. It needs to be recognised that financial stability is a joint responsibility of all stakeholders, says RBI Governor Shaktikanta Das.
RBI MPC Meeting 2024 Live: Two years ago, around this time, when CPI inflation had peaked at 7.8 per cent in April 2022, the elephant in the room was inflation. The elephant has now gone out for a walk and appears to be returning to the forest. We would like the elephant to return to the forest and remain there on a durable basis. In other words, it is essential, in the best interest of the economy, that CPI inflation continues to moderate and aligns to the target on a durable basis. Till this is achieved, our task remains unfinished, said RBI Governor Shaktikanta Das.
RBI MPC Meeting 2024 Live: RBI has forecast India’s CPI-based retail inflation at 4.5% for FY25. Here are detailed inflation forecast:
RBI MPC Meeting 2024 Live: RBI has projected India’s real GDP growth for FY25 at 7%. Here are detailed GDP growth targets:
RBI MPC Meeting 2024 Live: RBI forecasts India’s CPI inflation at 4.5% for FY25.
RBI MPC Meeting 2024 Live: The Reserve Bank of India (RBI) projected India’s real GDP growth for FY25 at 7%, said Governor Shaktikanta Das, with Q1FY25 at 7.1%, Q2 at 6.9% and Q3 and Q4 at 7% each.
RBI MPC Meeting 2024 Live: Here are key policy rates at present:
BI MPC Meeting 2024 Live: Core inflation declined steadily. Ensure to meet the target 4% for inflation and see upside risk on inflation. The MPC must be ‘actively disinflationary’, said Governor Shaktikanta Das.
The RBI’s Monetary Policy Committee (MPC) voted by a 5:1 majority to keep key rates unchanged at 6.5%. The policy stance is also maintained at ‘withdrawal of accommodation’, said RBI Governor Shaktikanta Das.
RBI MPC Meeting 2024 Live: RBI Governor Shaktikanta Das announced to keep the key repo rate unchanged at 6.5%. Policy stance also maintained at 'withdrawal of accommodation'.
RBI MPC Meeting 2024 Live: RBI Governor Shaktikanta Das will announce the Monetary Policy Commitee's decisions related to the repo rate, policy outlook, inflation and growth projections, among others. Click this link to watch live
Considering India's growth momentum remains robust, we think there is no urgency for the MPC to change policy settings (rates and stance) in the upcoming policy meeting. We expect the shift in policy stance to “neutral" to likely happen in the June policy. We maintain our call for a shallow rate cut cycle in FY25 (cumulative 50 bps), following the Fed pivot in June (UBS forecast) and as India’s real policy rate also starts inching into restrictive territory (amid faster-than-expected disinflation), said Tanvee Gupta Jain, Chief India Economist, UBS India.
The macroeconomic environment is favorable and the outlook for growth and inflation has improved. Hence, we expect that the RBI will maintain status quo in policy rates to align with the evolving growth-inflation dynamics and remain focussed on ensuring sustainable growth for the Indian economy. The industry overall wants policy stability and predictability above all else and a consistent maintenance of the repo rate will indicate that the RBI is content with the existing level of interest rates. This climate will bring in a greater amount of investment into the market and liquidity will improve, thus creating greater confidence in investors. The continuation in repo rates will also signify that depositors can continue to benefit from high-interest rates on deposits, said Swati Saxena, Founder & CEO – 4 Thoughts Finance.
Going ahead, we remain optimistic that the RBI will contemplate rate cuts and build a shallow rate cut cycle from June onwards to support lower interest rates and credit demand. Overall, we believe that investor sentiment will continue to remain bullish, supported by the market's persistent strength, she added.
The Indian stock market indices opened lower ahead of the announcement of RBI monetary policy today. The Sensex was trading 154.20 points, or 0.21%, lower at 74,073.43, while the Nifty 50 was down 51.50 points, or 0.23%, at 22,463.15 in the opening trade. Broader markets were flat.
RBI MPC Meeting 2024 Live: The Indian rupee opened flat against the US dollar ahead of the RBI policy announcement later today. The local currency opened at 83.43 a dollar as compared with Thursday’s close of 83.44.
We think the RBI's tone will slowly tiptoe to 'Gracklish' from the usual 'Hawk-Dove' signaling, implying a non-committal stance and limited definite forward guidance ahead. The fluidity of global narratives and policy repricing, in conjunction with the near-term problem-of-plenty on INR/bonds, could make it arduous for the RBI to find a balance in its policy biases, said Madhavi Arora, Lead Economist at Emkay Global Financial Services.
While the upcoming policy may not see material changes in macro assessment by RBI, issues like 1) case & timing of policy pivot/stance change, 2) factors influencing liquidity management ahead and, of course, 3) assessing which part of the yield curve has the maximum juice, etc would be key for markets. While bull-steepening looks to be a popular trade, consistent repricing of Fed cuts could spill over into the RBI's reaction function and will be cyclically noisy for bonds/FX, Arora added.
The RBI is anticipated to maintain status quo on policy rates and stance while observing the impact of global headwinds on Indian economic growth and inflation. From repo rate, GDP growth forecast to inflation projections, markets will keenly watch out for several things in RBI Governor Shaktikanta Das’ speech. Read here
While the April policy decision may maintain current policy rates, the market is eager to know if the RBI will cut rates before the Fed. With the Indian economy in a robust position and inflation still above its target of 4 per cent, the RBI is unlikely to rush into cutting rates. Instead, it is anticipated to continue utilizing other available tools to address excess liquidity. Read here
RBI MPC Meeting 2024 Live: Reserve Bank of India will likely keep repo rate unchanged at 6.5%. Stance will also be unchanged for better transmission of the delivered rate hikes (of 250 bps so far). Right now, food inflation is high so the biggest risk going ahead is monsoon. IMD has forecast a normal monsoon for the year, so timely kharif sowing can bring down food inflation. Till then, RBI is unlikely to cut interest rates, said Shraddha Umarji, Economist - Institutional Research at Prabhudas Lilladher.
The central bank will also take cues from what the Fed and ECB are doing when it comes to rates. So it is unlikely that rate cuts will happen before October. However, RBI could change its stance to 'neutral' in June or August. Meanwhile, GDP growth for FY25 might be revised upwards to 7.3-7.4% from 7% earlier as all macroeconomic data has been robust, she added.
RBI MPC Meeting 2024 Live: 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 Governor Shaktikanta 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. Read here
RBI MPC Meeting 2024 Live: As the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) gears up for its policy decision, a palpable sense of anticipation permeates the financial markets. Observers and analysts alike are poised for the RBI to uphold its current monetary policy stance, a decision that seems almost foreordained amidst the labyrinth of economic indicators and swirling global trends.
At the crux of the RBI's deliberate prudence is the albatross of inflation—a challenge that, despite substantial easing in core metrics, remains daunting due to persistently high costs of food and fuel and an uncertain outlook for these prices. Continue reading here
RBI MPC Meeting 2024 Live: The RBI’s Monetary Policy Committee headed by Governor Shaktikanta Das is expected to keep the key policy rates unchanged for the seventh consecutive meeting. The MPC meeting commenced on Wednesday, April 3, and concludes today, April 5. RBI governor Shaktikanta Das will announce the interest rate decision of the bimonthly monetary policy meeting at 10 am. With the status quo expected to be maintained on policy rates, the present Repo Rate is 6.5%; Standing Deposit Facility Rate is 6.25%; Marginal Standing Facility Rate is 6.75%; Bank Rate is at 6.75%; and the Fixed Reverse Repo Rate is at 3.35%.
RBI MPC Meeting 2024 Live: The Reserve Bank of India (RBI) Governor Shaktikanta Das will announce the first monetary policy of the financial year 2024-25 later today, April 5. The two-day review meeting of the RBI's Monetary Policy Committee (MPC), the rate-setting panel, ends today. The central bank will announce the repo rate decision at 10 am.
