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Below is Comment on RBI MPC Announcement By Niraj Kumar, FGILI

“MPC has delivered a well telegraphed and pragmatic policy given the backdrop of global inflation growth conundrum that we are posed with and is well preparing the markets for further course of normalization in coming months. The policy has a hawkish tilt shifting gears from its earlier ‘Dovish’ tone. This is well exemplified with change in MPC’s rhetoric with focus on withdrawal of accommodative stance, effectively normalizing to pre-pandemic policy rate corridor through new liquidity measure of Standing Deposit Facility (SDF), inflation forecasts being nudged higher to 5.7% & lowering growth forecasts to 7.2%. The extension of HTM limits from 22% to 23% until FY23 is indeed a welcome move from the standpoint of absorption of borrowings by banks. Overall a well- balanced policy given the fear of rising inflation led by global supply disruption, Russia -Ukraine standoff and challenging geo political environment.”

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