RBI today raised repo rate amid inflationary pressures
Reserve Bank of India (RBI) governor Shaktikanta Das made a surprising announcement on Wednesday to raise the repo rate by 40 basis points to 4.40 percent. which was decided at an off-cycle meeting of the Monetary Policy Committee held between May 2 and 4.
Let’s take a look at the top 5 quotes from the RBI governor’s nearly half-hour address.
“The Monetary Policy Committee considered that the inflation outlook warrants an appropriate and timely response through resolute and calibrated steps to ensure that the second-round effects of supply-side shocks on the economy are contained and that long-term inflation expectations remain firmly entrenched,” said RBI Governor Shaktikanta Das.
“Today’s decision to raise the repo rate can be seen as a reversal of the May 2020 rate action. Last month we had taken a stance to withdraw the property. Today’s action should be seen in line with that action,” said Mr Das.
“I would like to emphasize that the monetary policy action is aimed at containing the inflation spike and re-anchoring inflation expectations,” he added.
“High inflation is known to be detrimental to growth,” noted the RBI governor.
“Most worryingly, the ongoing and expanding inflationary pressures are becoming more acute every day,” he said.
