RBI Monetary Policy: Steady and bold

Among other things, the policy provides much needed visibility on central bank's balance sheet support for the bond market

The monetary policy review of the Reserve Bank of India (RBI) marks more than one year of living through the COVID pandemic phase that continues to confront social-economic-financial challenges for the Indian economy.

The second wave of COVID will increase uncertainty over India’s near-term growth prospects. This is happening at a time when global financial conditions, led by US rates, have begun to tighten, with few inflation targeting central banks in emerging markets (EMs) such as Turkey, Brazil, and Russia resorting to interest rate hikes in 2021 so far. In addition, Norway has emerged as the first developed country to