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    RBI MPC Meeting June 2022 Highlights: Governor Shaktikanta Das says future course will depend on evolving inflation-growth dynamics

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    RBI MPC Meeting June 2022 Highlights: Governor Shaktikanta Das says future course will depend on evolving inflation-growth dynamics

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    RBI MPC Meeting June 2022 LIVE: RBI Governor Shaktikanta Das will shortly reveal what's in store for the economy at the end of the Monetary Policy Committee's bi-monthly deliberations. The MPC is widely expected to announce a hike in the repo rate — the key rate at which the RBI lenders money to commercial banks — in today's statement. This is the first policy review since the RBI's surprise announcement of a 40 basis-point hike in the key rate on May 4. It comes at a time when major central banks around the globe are facing the Herculean task of taming decades-high inflation without causing an economic slowdown. 

    RBI MPC Meeting June 2022 Highlights: Governor Shaktikanta Das says future course will depend on evolving inflation-growth dynamics
    • Before signing off from the live updates on RBI's monetary policy, here are the top 10 key takeaways from RBI Governor Shaktikanta Das' speech today

    • Global prices may moderate soon which may allow for a pause sooner rather than later: Rajiv Shastri, Director, and CEO, NJ AMC

      "The MPC's actions are in line with the minutes of their previous meeting and indications thereafter. Higher rates are expected to moderate consumer demand, which may prevent higher producer prices from being passed on to customers going forward. However, this may squeeze corporate profits in the immediate term as they grapple with higher input prices and low demand from their consumers. Fiscal initiatives by the government may be needed to compensate for lower private consumption and sustain GDP growth at expected levels, which may result in higher government borrowings in the near term. However, there are some indications that global prices may moderate soon which may allow for a pause sooner rather than later."

    • Kaushik Das, Chief Economist, Deutsche Bank on inflation

      We are the happiest one because we are not surprised and I told you that our inflation forecast is 6.9 percent. I was not sure whether the RBI would go up too close to 7 percent, but 6.7 is very realistic. Only thing is, if you look at the forecast, they have taken 7.5 and 7.4 for the April, June, July, September - that looks more aggressive. But October, December, January, March - they are taking much lower than what our own forecasts are. So my guess is that we don't know about October, December, January, and March, but I think inflation is still on the higher side, and it could be closer to 6.9 or 7 percent rather than 6.7 what RBI has given. But it's a good kind of adjustment that RBI has done 100 basis points.

    • India faces growth challenges but medium-term fundamentals solid: Chief economic advisor

      “We are right now in a situation where there is a considerable amount of challenge that we face for the Indian economy both from the global macro monetary policy and political developments,” said chief economic advisor V Anantha Nageswaran after the Reserve Bank of India raised its policy rate by 50 basis points.

    • Kaushik Das, Chief Economist, Deutsche Bank on RBI's stance: I am very happy that RBI has removed this accommodative word. I was actually looking for calibrated tightening but maybe they will wait on till the repo rate has reached to the pre-pandemic level.

    • "Policy announcement is on expected lines, reflecting the Central Banker’s continued focus on a non-disruptive trade-off between growth and price stability, in a calibrated manner," said Atanu Kumar Das, MD & CEO, Bank of India’s on RBI's monetary policy.

    • Card tokenisation process is satisfactory

      Progress towards tokenisation is satisfactory, said deputy governor Rabi Sankar. The central bank's deadline for card tokenisation is June 30.

    • Liquidity withdrawal will be calibrated and measured in future and we will ensure that adequate liquidity remains available to meet banks' requirements: RBI Governor

    • Users should check if lending apps are registered with RBI

      Constant engagement between government and RBI on Cryptos. Users should check if lending apps are registered with RBI: Governor Shaktikanta Das

    • Allowing the linking of credit cards to UPI is all about giving a wider choice of payments to customers. We will introduce the arrangement and see how the pricing goes: RBI Deputy Governor T Rabi Sankar

    • RBI not bound by convention, future course will depend on evolving inflation-growth dynamics

      On being asked about the breach of the inflation target of 6 percent according to the RBI-government framework, Governor Shaktikanta Das said RBI will deal with the situation as and when the situation arises. He noted that these are extremely uncertain conditions, and hence extremely uncertain outlooks. It is not possible to provide forward guidance, Das said.

    • Rate hike will push up home loan interest rates, but they will remain lower than in 2008: ANAROCK

      A hike was inevitable, but we are now entering the red zone. Any future hikes will reflect markedly on housing sales. The RBI is tasked with controlling the spiralling inflation but must simultaneously be careful not to hurt demand recovery. The rate hike will push up home loan interest rates, but they will remain lower than during the global financial crisis of 2008, when they went as high as 12 percent and above. The current hike will reflect more in the affordable and mid-realty segments. The silver lining is that the Indian housing market is still largely end-user driven, so there is no investor mindset seeking the lowest possible entry point, said Anuj Puri, chairman of ANAROCK.

    • Endeavour is to move towards 4% inflation target: RBI Governor

      RBI MPC Meeting June 2022 Highlights: Governor Shaktikanta Das says future course will depend on evolving inflation-growth dynamics
    • Completely focused on the withdrawal of accommodation: RBI

      RBI MPC Meeting June 2022 Highlights: Governor Shaktikanta Das says future course will depend on evolving inflation-growth dynamics
    • 75% of inflation projections attributed to food inflation

      RBI Governor Shaktikanta Das, said: “75 percent increase in inflation projections attributed to food inflation.” RBI has raised FY 2023 inflation projections to 6.7 percent.

    • Central Bank Digital Currency will be introduced this year: Deputy Governor T Rabi Sankar

      The process of introduction will be gradual so that there is no disruption in the financial system, said Deputy Governor T Rabi Sankar.

    • RBI remains accommodative but is focusing on withdrawal of accommodation: Shaktikanta Das

      ‘In terms of rates, RBI is still below the pre-pandemic level and in liquidity terms, we are above pre-pandemic level- this is what we mean when we say we remain accommodative,’ Das said.

    • Expect RBI to continue hiking the repo rate to ensure a neutral to the marginally positive real policy rate: Kotak Institutional Equities

      “The June policy was a continuation of the off-cycle policy with the focus remaining squarely on inflation. The RBI’s decision of hiking the repo rate by 50 bps as well as increasing the inflation estimate by 100 bps was in line with market expectations. The tone of the policy continues to be hawkish and we expect the RBI to continue hiking the repo rate to ensure a neutral to the marginally positive real policy rate. We expect 35 bps repo rate hike in the August policy to 5.25% and repo rate at 5.75% by end-FY2023. Along with pushing the repo rate to above the pre-pandemic level, a 35 bps hike would also signal a gradual normalization in the policy actions while being adequately hawkish. We also expect another 50 bps hike in CRR to 5% by end-FY2023 to move the liquidity conditions towards the pre-pandemic levels,” said Suvodeep Rakshit, Senior Economist at Kotak Institutional Equities.

    • Good news for the likes of DLF but more competition for HDFC and peers

      The RBI on Wednesday more than doubled the limits in place on urban and rural cooperative banks for doling out residential home loans, citing an increase in housing prices. The central bank also permitted urban cooperative banks to offer doorstep services. The RBI announcements gave a boost to real estate stocks such as DLF, Godrej Properties, Sobha, Lodha and Oberoi. (Read More)

    • The next meeting of the MPC is scheduled during August 2-4, 2022

    • Bank of Baroda, Hero MotoCorp and DLF top gainers among banks, auto and realty stocks as RBI springs no surprise

      Most rate-sensitive stocks — the stocks of companies in sectors sensitive to changes in interest rates — edged higher on Wednesday following the Reserve Bank of India’s (RBI's) repo rate hike announcement. The central bank raised the key lending rate by 50 basis points (bps) to 4.9 percent. One basis point is one-hundredth of a percentage point. (Read More)

    • RBI allows linking of UPI with credit cards and RuPay customers will benefit first

      Reserve Bank of India (RBI) Governor Shaktikanta Das said on Wednesday that the linking of the Unified Payment Interface (UPI) with credit cards would be allowed soon and those with RuPay credit cards would get the benefit first. (Read here for more)

    • Advanced Economies Causing Volatility

      “The faster pace of monetary policy normalisation undertaken by systemic advanced economies (AEs) is leading to heightened volatility in global financial markets. This is reflected in sharp corrections in major equity markets, sizeable swings in sovereign bond yields, US dollar appreciation, capital outflows from EMEs and even from some AEs,” said RBI Governor Das.

    • RBL Bank revises FD interest rates: Check details here

      The RBL Bank has revised interest rates on fixed deposits below Rs 2 crore. The modifications come into effect from June 8, 2022. After the revision, the bank is offering interest rate of 3.25 percent to 5.75 percent to all citizens and 3.75 percent to 6.25 percent to senior citizens.

    • We foresee further repo hikes of 35 bps and 25 bps, respectively, in the next two policies: ICRA

      "While further rate hikes remain clearly on the table, with the reference to the revised repo rate of 4.9% remaining below the pre-pandemic level, the comment on the orderly completion of the government borrowing programme has served to cool the 10-year G-sec yield. We foresee further repo hikes of 35 bps and 25 bps, respectively, in the next two policies. However, the upmarch in the yields will now be somewhat shallower than our earlier expectations," Aditi Nayar, Chief Economist, ICRA, on MPC

    • Key takeaways of RBI policy

      Clearly, markets went into this policy expecting 50 basis points so that has played out. No CRR hike has been a big positive in terms of the sentiment for the short end. So I suppose this combination has helped markets recover some of the selloff we saw in the previous two days. So effectively at 7.44 for the 10-year benchmark, we are sort of somewhat very close to where we ended last week, said Amandeep Chopra, Group President, Head of Fixed Income at UTI MF.

    • Yes Bank on RBI’s stance

      “This is almost equivalent to saying that we are more neutral than before. So that's one thing that I would take from the stance. And second, anyway, the action is clear that they will want to take away the pandemic related accommodation that was there - that is the first objective for the Reserve Bank of India and after that, the judgment will come in terms of any incremental tightening. So, my perspective, therefore, is that till this point in time, they will probably take the report back to the pre-pandemic level, they do not really change the stance back to either a neutral or a tightening bias, they will still continue to say that we take away the accommodation and that to a certain extent to me is a substitute for saying that we are more neutral than before,” said Indranil Pan, Chief Economist, Yes Bank.

    • Sensex jumps 600 pts from day's low and Nifty50 crosses 16,450 after RBI announces rate hike as expected

      Catch all live market updates with CNBC-TV18's blog

    • The key is to pay off loan in the intended timeframe: Adhil Shetty, BankBazaar.com

      Home loan interest rates which had bottomed out around 6.50 percent in April will now be inching towards 7.60 percent in June. The back-to-back repo rate hikes will make floating-rate loans longer. For example, if a person had borrowed at 7.00% for 20 years and if their rate increased to 7.50%, they would need to be 24 more EMIs. If they had opted for an EMI adjustment, their per lakh EMI would increase by 30 rupees in the above example. In essence, their monthly outgo would increase by about 4%. The math is different for each borrower. The key is to pay off the loan in the intended timeframe. Borrowers may use pre-payment methods such as EMI step-ups or lump-sum payments to control their interest burden. — Adhil Shetty, CEO, BankBazaar.com.

    • Our actions today will impart further credibility to our medium-term inflation target: Shaktikanta Das

      Given the elevated uncertainty, we have remained dynamic and pragmatic rather than be bound by stereotypes and conventions. Experience teaches us that preserving price stability is the best guarantee to ensuring lasting growth and prosperity. Our actions today will impart further credibility to our medium-term inflation target.

    RBI MPC Meeting June 2022 LIVE
    : Governor Shaktikanta Das today announced that the central bank has raised key rates by by 50 bps to 4.90 percent. Consequently, the standing deposit facility (SDF) rate stands adjusted to 4.65 percent and the marginal standing facility (MSF) rate and the bank rate to 5.15 percent. The Monetary Policy Committee (MPC) also voted unanimously to remain focused on the withdrawal of accommodation to ensure that inflation remains within range going forward, while supporting growth. Chief economic advisor V Anantha Nageswaran said in an event today that India faces immediate challenges on the growth, inflation and fiscal fronts but its medium-term fundamentals remain solid.

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