The Reserve Bank of India has revised the real GDP growth projection for 2020-21 from -9.5% to -7.5 per cent, the Governor Shaktikanta Das said in an online briefing at the end of the meeting of the Monetary Policy Committee.
The real GDP growth for 2021 is projected at minus 7.5%. The recovery in rural demand is expected to strengthen further while urban demand is also gaining momentum, said the RBI Governor.
The central bank also maintained an “accommodative” stance of policy, which rules out any hikes for now and decided to continue with the current stance.
“Monetary Policy Committee (MPC) was of the view that inflation is likely to remain elevated with some relief in the winter months from prices of perishables and bumper Kharif arrivals” said Das
The Reserve Bank of India’s Monetary Policy Committee maintained the key lending rate unchanged at 4 per cent , holding the rates at existing levels for a third straight review. The status quo on monetary policy was as expected by most economists, amid high levels of inflation and the country’s shrinking gross domestic product.
Das further stated : ” MPC decided to continue with accommodative stands of monetary policy as long as necessary, at least till current financial year & into next year to revive growth on a durable basis & mitigate the impact of COVID-19 while ensuring that inflation remains within target”