RBI hikes rates by 50 bps, but retains GDP projections

The Reserve Bank of India Governor Shaktikanta Das on Friday said that the rate-setting panel Monetary Policy Committee (MPC) has decided to retain its real GDP growth projections despite hiking rates by 50 bps.

Analysts had expected the MPC to retain its FY23 Consumer Price Inflation (CPI) and real GDP growth forecasts, at 6.7% and 7.2%, respectively.

Growth projections for the first quarter of the ongoing fiscal have been retained at 16.2%, 6.2% for Q2, 4.1% for Q3 and 4% for Q4, with risks broadly balanced, Governor Das said. For Q1 FY24, the projection has been retained at 6.7%.

‘No question of India falling into a recession’


The Finance Minister earlier this week said that due to the measures taken by the government, India is in a much better position than most countries. Referring to a survey, Sitharaman said there is zero possibility of India getting into recession. Sitharaman said the GDP of the US fell 0.9% in the second quarter following a 1.6% decline in the first quarter. "They start calling it an unofficial recession. There is no question of India getting into recession or stagflation," said the Minister.