RBI’s February 2024 MPC Meeting Highlights Stability Measures and Initiatives for Economic Resilience
The Reserve Bank of India (RBI) opts for stability by keeping the policy repo rate steady at 6.5% amidst inflation concerns and rising geopolitical tensions. Governor Das emphasizes the need for a balanced approach towards growth and inflation management.
The Reserve Bank of India (RBI) announced during its February 2024 meeting for the Monetary Policy Committee that it will maintain the policy repo rate unchanged at 6.5%, as per a constant decision toward abating any further inflation gaining momentum throughout all brands With this, RBI also looks to instigate new resolution mechanisms; make significant changes within capital markets and This move by RBI reflects the organization’s intent to ensure stability even with new economic realities emerging from time-to-time. The MPC had also forecasted the fiscal year 2024 Consumer Price Index (CPI) at 5.4%, projected for a decline to 4.5% in the next fiscal period the fiscal year occurring in myriad years, four from now
During the concluding remarks, Governor Das underlined that RBI’s focus is both on relieving its accommodative stance and ensuring sustained growth. He also mentions the building-up speed of the investment cycle that has been influenced by continuous government capital expenditure. Furthermore, the RBI projected an estimated 7% real GDP growth rate for the fiscal year.
Nevertheless, despite such rosy predictions of investment activities in this region, Governor Das has announced that there are still problems with rising geopolitical tensions. He noted that these conflicting interests are affecting international logistics and creating stress on the prices of commodities, especially crude oil. Domestic inflationary trends and economic stability can be potentially affected by such external factors as they.
To fulfill the pledge towards financial inclusion and transparency, RBI announced multiple initiatives. Further, lenders will have to file key fact statements about loans to retail and MSME borrowers which ensure the transparency of the loan process. Additionally, the central bank revealed intentions about launching offline e-rupee transactions fairly soon to provide possible digital payments even despite poor conditions of filer internet connectivity.
Additionally, the RBI announced its plan to adopt a principal-based authentication approach that would help to encourage alternative IT-based mechanisms for digital payments thereby minimizing SMS OTP systems.
Furthermore, electronic platforms will be reviewed in the area of these regulatory frameworks to allow access to offshore entities providing Indian Rupee products.
