Reserve Bank of India (RBI) Governor Shaktikanta Das, explaining the decision to maintain policy repo rates, stated that premature policy pivots could undermine the progress achieved so far. MPC member Jayanth Varma argued there is room for monetary easing without risking an inflation spiral, suggesting a rate cut and a shift in stance to neutral.
Reserve Bank Governor Shaktikanta Das has emphasized the importance of stable and low inflation for sustainable economic growth. He highlighted that India has successfully navigated through multiple challenges and emerged as the fastest-growing large economy. The Reserve Bank projects India s economy to grow by 7.0% during 2024-25, marking the fourth consecutive year of growth at or above 7%.
Inflation in India rose to 5.7% in December, despite most categories experiencing an easing of inflation. Core inflation fell to its lowest level in 48 months, while the food index rose to its highest level in four months. The analysis of inflation is based on data from 1,114 urban markets and 1,181 villages, collected through personal visits by field staff.
While the Reserve Bank of India s rate-setting panel opted to maintain unchanged rates in its December meeting, Governor Shaktikanta Das expressed concerns about inflation, acknowledging its retreat from highs but noting its persistent volatility. External MPC member Jayanth Varma suggested that a stance might not be necessary, but if adopted, it should be neutral.
India Inflation: While the Reserve Bank of India s rate-setting panel opted to maintain unchanged rates in its December meeting, Governor Shaktikanta Das expressed concerns about inflation, acknowledging its retreat from highs but noting its persistent volatility. External MPC member Jayanth Varma suggested that a stance might not be necessary, but if adopted, it should be neutral.