Recovery in aggregate demand gathered pace in August-September,” the RBI said.Īccording to Das, overall, aggregate demand is improving but slack remains. “Almost all components of GDP registered y-o-y growth, despite a sharp loss of momentum due to the second wave. The RBI has retained the projection for real GDP growth at 9.5 per cent in 2021- 22, consisting of 7.9 per cent in Q2 of the current year. Its momentum is expected to remain muted in the near term, it said.

Going forward, the inflation trajectory is set to edge down during Q3 of 2021-22, as several evolving factors provide comfort on the food price front. The RBI has slashed the inflation forecast for 2021-22 to 5.3 per cent from the 5.7 per cent estimated earlier. While five members of the six-member MPC, including Governor Das, supported the continuation of the accommodative stance, Jayanth Varma expressed reservations on retaining the stance. The MPC said it will continue with the accommodative stance as long as necessary to revive and sustain growth on a durable basis, and continue to mitigate the impact of Covid on the economy. Our approach will be calibrated, it will be an approach of gradualism,” he said. Because we realise there are lives and journeys beyond the shore, so we don’t want surprises.

More so, we realise as we approach the shore, we don’t want to rock the boat. “Our entire approach is one of gradualism. The central bank pumped Rs 2.37 lakh crore through various market operations including G-SAP in the first six months of the current year to revive the economy. RBI has discontinued the government securities acquisition programme (G-SAP) as part of liquidity normalisation. As the economy shows signs of emerging from the ravages inflicted by the pandemic, a near consensus view emerging among market participants and policy makers is that the liquidity conditions emanating from the exceptional measures instituted during the crisis would need to evolve in sync with the macroeconomic developments to preserve financial stability, Das said.

Key bank interest rates today