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Below is Quote on RBI Monetary Policy Announcement By Ms. Shalini Tibrewala, Senior Fund Manager (Fixed Income), JM Financial Asset Management Limited 

The Reserve Bank of India hiked its key repo rate by 25 basis points as expected but surprised markets by leaving the door open to more tightening, saying core inflation remained high

The global economic outlook does not look as grim now as it did a few months ago. Growth prospects in major economies have improved, while inflation is on a descent though still remains well-above target in major economies. The situation remains fluid and uncertain,” RBI Governor Shaktikanta Das said while announcing the Monetary Policy Committee’s rate decision

The RBI hiked repo rate for the sixth consecutive time in the current financial year by 25 bps to 6.50% mainly to curtail inflationary expectations. RBI remains focused on its stance of withdrawal of accommodation to ensure inflation remains within target going forward, while supporting growth.

RBI has maintained the growth forecast at 7% (6.8% previously) and inflation forecast at 6.50% (6.7% previously) for FY 22-23 respectively. For FY 23-24 growth is projected at 6.40% and CPI inflation at 5.30% with risks evenly balanced on either side.

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