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"In today’s Monetary Policy Committee (MPC) meeting, the spotlight was on GDP growth and inflation dynamics.

Amidst a slowdown driven by weaker industrial activity, the RBI has revised its full-year GDP growth forecast downward. Despite the concerns of the slowing economy, the RBI is confident that the growth shall revive given the encouraging signs from high frequency indicators such as recovery in rural areas and strong festive demand.

On the inflation front, concerns have risen with October’s inflation breaching the 6% upper tolerance limit, primarily due to food price shocks. Although this spike was unexpected, the MPC anticipates inflation easing as these shocks subside, prompting the decision to hold interest rates steady.

RBI has announced a reduction in the Cash Reserve Ratio (CRR) to inject additional liquidity into the banking system. This move aims to stimulate credit flow, encouraging investments and consumption to drive economic activity forward.

The RBI has employed liquidity measures to support economic growth amidst prevailing inflationary concerns. Looking ahead, we anticipate a moderation in inflation levels, which could pave the way for the RBI to initiate interest rate cuts, further stimulating economic activity and growth."