RBI MPC: Here are the major announcements made by Governor Shaktikanta Das

The Reserve Bank of India put the estimated real GDP growth for FY25 at 7 per cent

The Reserve Bank of India's Monetary Policy Committee (MPC), on Friday, decided to keep the repo rate unchanged at 6.5 per cent for the seventh consecutive time. While projecting a positive growth outlook for FY25 amid improving global indicators and growing domestic demand, RBI Governor Shaktikanta Das highlighted that high food inflation needs to be closely monitored.
 

The repo rate was last changed in February 2023, when it was hiked from 6.25 per cent to 6.5 per cent. Between May 2022 and February 2023, the repo rate was raised by 250 basis points (bps).

Here are the key takeaways from the RBI policy announcement:

 

Continuing withdrawal of accommodation policy stance

Further, to align inflation with growth targets, Das said that the central bank will continue withdrawing its accommodation policy stance. The decision was based on a majority of 5:1 vote, he informed, adding that since the last policy, the growth-inflation dynamics have played out favourably.

Read More: Rate sensitive shares trade firm as RBI keeps repo rate unchanged at 6.5%

What did Shaktikanta Das say about the global economy?

Das said that the global economic situation appears resilient and that global trade is expected to grow. However, on inflation, he said that although inflation is slowly moving closer to targets around the world, the last mile of tackling inflation is proving to be difficult. And worsening debt situation in a few advanced economies may spillover to India as well, he said.

Additionally, Das announced that India's foreign exchange reserves have hit an all-time high at $645.6 billion as of March 29.

Read More: RBI MPC keeps repo rate unchanged: What home loan borrowers must do now

What was RBI's proposal on e-currency CBDC?

Talking about the Central Bank Digital Currency (CBDC), Das proposed to enable non-bank payment system operators to offer CBDC wallets. While this will test the resilience of the CBDC platform to handle multi-channel transactions, it will widen the reach of the digital currency to reach a broader segment of users.

UPI access for prepaid instruments

The RBI also announced UPI access for prepaid instruments (PPIs) through third-party apps. Governor Das said that third-party UPI apps should be permitted to make UPI payments from the PPI wallets. Currently, payments through PPIs can be made using only web or mobile applications provided by the issuer. He said that this will further enhance customer convenience and boost adoption of digital payments for small value transactions.