Repo Rate Remains Unchanged, GDP Growth to be Negative: RBI Guv
The reverse repo rate also remains the same at 3.3 percent, the central bank governor announced.
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RBI Governor Shaktikanta Das on Thursday, 6 August, said that the repo rate remains unchanged at 4 percent. The reverse repo rate also remains the same at 3.3 percent, he added during his address after the bimonthly policy review.
His briefing comes amid the Indian as well as the global economy facing a slump due to the COVID-19 pandemic and the subsequent lockdowns.
Das said the accommodative stance of the monetary policy will continue as long as necessary to revive growth and mitigate the impact of the COVID-19 pandemic, while ensuring that inflation remains within the target, going forward.
On Economic Growth
On the GDP growth amid the pandemic, he said that it is estimated to remain in the contraction zone in the first half of the year. "For the year 2020-21 as a whole, real GDP growth is also estimated to be negative," the central bank governor added.
Economic activity had started to recover, but a surge in infections has forced imposition of lockdowns, he pointed out, adding that supply chain disruptions persist.
According to the Monetary Policy Committee, inflation pressures might also remain elevated in the second quarter and ease only in the second half of the fiscal year, news agency PTI reported.
Measures Announced
Citing the prevailing conditions, Das announced regulatory and developmental measures to enhance liquidity support for financial markets, ease financial stress caused by COVID-19, strengthen credit discipline, improve the flow of credit and deepen the digital payment systems.
He said that a Rs 10,000 crore additional liquidity facility will be provided by the National Housing Bank and NABARD.
Moreover, loans against gold have been enhanced to 90 percent of the value from the current 75 percent to mitigate the impact of COVID-19 on households, PTI quoted Das as saying.
The priority sector lending status has also been extended to start-ups.
(With inputs from PTI and ANI.)
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