MPC alters tone, embracing growth optimism for FY24
- Inflation outcomes in FY25 will be influenced by when the El Nino recedes
The Monetary Policy Committee’s (MPC) penultimate bi-monthly meeting for FY24 largely played out along expected lines. The policy rate and stance were left unchanged, with a unanimous, and a 5:1 vote, respectively. While inflation forecasts were unchanged, there was a sharp upward revision in the MPC’s growth forecasts for H2 FY24. Overall, rather than coming across as hawkish on inflation, the overarching tone of this policy was of optimism on growth.