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Address by Governor, Reserve Bank of India Shri Shaktikanta Das to start shortly

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The pandemic holds world economy hostage, economic activity especially in contact-intensive sectors being dented worldwide: RBI Governor

India is charting a different course of recovery from the rest of the world, poised to grow at fastest pace y-o-y among major economies according to IMF projections; recovery supported by large scale vaccination and fiscal and monetary support: RBI Governor

Focus is on securing economic and financial conditions of vulnerable sections, emphasis is shifting to targeted containment and push towards universal vaccination and booster doses; complemented by increasing use of tech, to limit disruptions to economic activity: #RBI Governor

MPC has voted unanimously to keep policy Repo Rate unchanged at 4.0%: #RBI Governor

Marginal Standing Facility Rate and Bank Rate remain unchanged at 4.25%

Reverse repo rate also remains unchanged at 3.35%

: #RBI Governor

MPC has voted 5-1 to continue accommodative monetary policy stance as long as necessary to revive and sustain growth and mitigate impact of #COVID19 on the economy, while ensuring inflation remains within target: #RBI Governor

#Omicron resulted in some loss of momentum of eco. activity; demand for contact intensive sectors still muted;impulses for quickening recovery emanate from Rabi prospects,export demand,accommodative monetary & liquidity conditions, push for capital expenditure in #Budget2022:#RBI

Increase in inflation in December was entirely due to unfavourable base effects; buffer cereal stocks and effective supply side measures augur well for food inflation: #RBI Governor

Headline inflation is expected to peak in Q4 2021-22 within tolerance band and then come closer to target in second half of 2022-23, providing room for accommodative monetary policy: #RBI

Taking into consideration inflation and growth outlook, comfort provided by inflation outlook, uncertainty due to omicron and global spillovers, MPC was of the view that continued policy support is warranted for a durable and broad-based recovery: #RBI

Real GDP growth at 9.2% for 2021-22 is modestly above level of GDP for 2019-20

Private consumption trails pre-pandemic level

Persistent rise in int'l commodity prices, surge in volatility of financial markets and supply bottlenecks can pose risks to this outlook
: #RBI Governor

Government's thrust on capital expenditure and exports expected to enhance productive capacity and strengthen aggregate demand, also crowd in private investment: #RBI Governor

Real GDP growth is projected at

7.8% for 2022-23

Q1 - 17.2%
Q2 - 7.0%
Q3 - 4.3%
Q4 - 4.5%

: #RBI Governor

Softening of food prices welcome relief to #inflation

Improving foodgrain production & expected easing of vegetable prices adding further optimism

Strong supply side interventions by govt & increase in domestic prodn. expected to further ease prices of pulses & edible oils:#RBI

Inflation projection for 2021-22 is retained at 5.3%

Q4 of 2021-22 - 5.7% on account of unfavourable base effects

CPI inflation for 2022-23 is projected at 4.5%

Q1 - 4.9%
Q2 - 5.0%
Q3 - 4.0%
Q4 - 4.2%

: #RBI Governor

Despite pandemic induced bouts of extreme volatility, thanks to #RBI's efforts, Indian financial system has remained resilient and is now in a better position to meet credit demands as recovery takes hold and investment picks up: RBI Governor

We have to be watchful of impact of pandemic on Banking & NBFC sectors. When effects of regulatory reliefs fully work their way through, banks & other financial entities are advised to strengthen corporate governance & risk management strategies to build resilience: #RBI Governor

Policy actions of #RBI have yielded desired results, RBI has hence turned to rebalancing liquidity on a dynamic basis: #RBI Governor @DasShaktikanta

This has involved rebalancing liquidity from fixed rate reverse repo to 14-day variable rate reverse repo auction as main operation & conducting repo auctions of 1-3 day maturity to meet transient liquidity mismatches and shortages: #RBI Governor

https://twitter.com/PIBMumbai/status/1491638285914939395?s=20&t=FEuAVwpY_YxiuYjMia89dw

Variable Rate Repo Operations of varying tenures will henceforth be conducted as and when warranted by evolving liquidity and financial conditions within the CRR maintenance cycle, announces #RBI Governor @DasShaktikanta

Variable Rate Repos and Variable Rate Reverse Repos of 14-day tenure will operate as the main liquidity management tool, based on liquidity conditions; these will coincide with CRR maintenance cycle: #RBI Governor

These main operations will be supported by fine-tuning operations to tide over unanticipated liquidity changes during reserve maintenance period; auctions of longer maturity also to be conducted as warranted: #RBI Governor

From March 1, 2022, fixed rate reverse repo and MSF operations will be available only during 5.30 PM - 11.59 PM on all days, instead of from 9.00 AM - 11.59 PM

- announces @RBI Governor, due to return to normalcy on liquidity front

Indian rupee has shown resilience in forex market in face of global spillovers; high forex reserve buffers and modest Current Account Deficit provide sustainability to our external sector: #RBI Governor

CAD was 0.2% of GDP in first half of 2021-22; merchandise trade deficit has widened in recent months, CAD likely to stay well below 2% of GDP during 2021-22: #RBI Governor

.#RBI Governor announces additional measures

1️⃣Extension of On Tap Liquidity Facility for Emergency Health Services (Rs. 50,000 cr.) and Contact Intensive Sectors (Rs. 15,000 cr.) announced in May & June 2021, banks were given incentives to lend under these two schemes

Due to continued uncertainty due to third wave, these two schemes are being extended from March 31, 2022 to June 30, 2022

https://twitter.com/PIBMumbai/status/1491642271879421960?s=20&t=FEuAVwpY_YxiuYjMia89dw

2⃣Enhancement of Limits under Voluntary Retention Route Scheme introduced in March 2019 to facilitate long term Foreign Portfolio Investment in debt securities issued by government and corporates

Limit for investment enhanced from Rs. 1.5 lakh crore to Rs. 2.5 lakh crore, w.e.f April 1, 2022; will provide additional sources of capital to domestic debt market, including for govt. securities

https://twitter.com/PIBMumbai/status/1491643080667123719?s=20&t=FEuAVwpY_YxiuYjMia89dw

3⃣Final Directions for Credit Default Swaps being issued today, following feedback received from the public

Will facilitate development of credit derivatives market and deepen corporate bond market in India

4⃣Banks will now be allowed to undertake transactions in Offshore Foreign Currency Settled (FCS) Overnight Index Swaps (OIS) with non-residents and other market makers

Will reduce segmentation between onshore and offshore markets, enable more efficient price discovery and further deepen interest rate derivatives market in India

https://twitter.com/PIBMumbai/status/1491644155470118920?s=20&t=lCl7n0zMbGvb7v4DvCb4AQ

5⃣Cap under e-Rupee Prepaid Single Use Digital Payment Voucher issued by Centre & States from Rs 10,000-Rs 1 lakh per voucher, such vouchers can now be used more than once till amount is completely redeemed
Will facilitate more efficient delivery of govt. schemes to beneficiaries

6⃣Mandate Limit of Transactions in Trade Receivables Discounting System (TReDS) settled through National Automated Clearing House

NACH Mandate Limit for TReDS related settlements to be increased from ₹1 crore at present to ₹3 crore

This will further enhance the ease of financing the growing liquidity requirements of #MSMEs

https://twitter.com/PIBMumbai/status/1491645445407318018?s=20&t=lCl7n0zMbGvb7v4DvCb4AQ

7⃣Draft directions - Reserve Bank of India (IT Outsourcing) Directions, 2022 and Reserve Bank of India (Information Technology Governance, Risk, Controls and Assurance Practices) Directions, 2022 - to be issued for public comments

To review and address issues relating to financial, operational and reputational risks faced by Regulated Entities, in wake of IT outsourcing and increasing use of digital channels by customers

https://twitter.com/PIBMumbai/status/1491646318304923656?s=20&t=lCl7n0zMbGvb7v4DvCb4AQ

“Aaj phir jeene ki tamanna hai"

#RBI Governor @DasShaktikanta quotes #LataMangeshkar song, noting that if the two years of living with the virus have taught us anything, it is to remain humble, but grounded in self-belief, never losing confidence and optimism

#RBI remains steadfast in its commitment to safeguard trust & confidence in the domestic financial system as we rebuild the foundations of strong & sustainable growth with macroeconomic stability. This has been our anchor in the ocean of uncertainty: @RBI Governor @DasShaktikanta

#RBI Governor @DasShaktikanta concludes his monetary policy statement, quoting #MahatmaGandhi - “Satisfaction lies in the effort, …… Full effort is full victory"