MPC Minutes

The continuing global uncertainity has complicated the fight against inflation, opined Reserve Bank Deputy Governor Michael Debabrata Patra during the Monetary Policy Committee meeting held on February 8. According to the minutes of the MPC meeting released on Wednesday, RBI Governor Shaktikanta Das also mentioned that there is considerable uncertainty due to a host of global factors such as rising non-oil commodity prices. The RBI on February 8 hiked the key short-term lending rate by 25 basis points to 6.5 per cent, citing sticky core inflation. It was the sixth interest rate hike by the Reserve Bank of India (RBI) since May last year, taking the total quantum of increase to 250 basis points. "The fight against inflation is complicated by the global outlook. There is some consensus growing around a milder slowdown than earlier feared, although geographical disparities complicate the prognosis. Be that as it may, the outlook for global inflation is turning more uncertain than ...

While two of the eminent panelists - Ghosh and Nayar - said they expect a pause in the monetary cycle by the MPC, Chakraborty, Sagar, and Kapoor said the MPC could still hike by 25-50 basis points

Governor Das said due to persistent core inflation, there is no room for complacency and the battle against inflation is not over

MPC minutes show Das saying that in a tightening cycle, especially in a world of high uncertainty, giving out explicit forward guidance on the future path of monetary policy would be counterproductive

1-year bond yield logs the sharpest fall in two-and-a-half months

The next review of the monetary policy committee is scheduled on December 5-7

The MPC is of the view that further calibrated monetary policy action is warranted to keep inflation expectations anchored

According to the July Bulletin article, the current level of reserves were equivalent to 9.5 months of imports projected for 2022-23

Either inflation has to come down on its own or we will have to raise the rate, or it will be a combination of the two, says MPC member Varma

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CPI inflation was 7.04% in May. In its June policy review, the MPC raised repo rate by 50 bps to 4.9%, taking the total tally of rate hikes since May to 90 bps

'The markets should not assume we will guide them, because the data is coming without warning', said Varma

Policy making has to be nuanced and nimble, says RBI governor Shaktikanta Das

The six-member MPC voted to keep the policy rate unchanged and continued with the accommodative stance at its meeting on February 10

'Need to remain vigilant to incipient cost-push pressures to inflation as well as to uncertainty imparted by Omicron. Its implication for inflation, going forward, are two-fold,' says Shaktikanta Das

His was the lone dissenting voice against a continued "accommodative" stance, minutes of the August 4-6 meetings showed

RBI extended the on-tap targeted long term repo operations (TLTRO) scheme till December 31

MPC minutes show one member saw little merit in continuing with central bank's forward guidance

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The RBI governor also said that global financial markets have turned volatile over inflation fears in advanced economies and rising commodity prices, posing risks to the domestic outlook