RBI Update its Monetary Policy

Highlights:

• India's apex financial institute RBI updated its Monetary Policy.
• RBI’s Monetary Policy Committee (MPC) kept key interest rates unchanged. 
• It retained the accommodative stance in its first policy after Union Budget 2022.
• This is the tenth consecutive time that, MPC has maintained the status quo.
• The three-day RBI MPC meeting started on February 8, and concluded on February 10.
• Last MPC was held in December 2021, keeping benchmark interest rate unchanged at 4 %. 
• It decided to continue with its accommodative stance amid the emergence of new coronavirus variant Omicron.
• MPC kept the repo rate as well as reverse repo rate unchanged, respectively at 4 % and 3.35 %.
• It continued with the ‘accommodative’ stance in the backdrop of high inflation.
• RBI projected GDP growth for Financial Year 2023 at 7.8 %.
• Real GDP growth of 9.2 %  in Financial Year 2022 (FY 2022) will take economy above pre-pandemic level.
• CPI inflation forecast for FY 2022 has been kept at 5.3 %. 
• It is expected to reach 4.00 % target in second quarter of FY23.
• Rupee has shown resilience in light of global spill-overs.
• Current account deficit was below 2 % of GDP in FY22.
• It proposed to increase the Cap of e-vouchers, from Rs 10,000 to Rs 1 lakh.
• Variable Rate Repo Operations of varying tenors will be conducted when required. 
• Variable rate repos and variable rate reverse repos for 14-day tenors will act as main liquidity management tool. 
• These operations will be aided through fine turning operations. 
• Monetary Policy Committee (MPC) is responsible for fixing benchmark interest rate in India. It held meetings at least 4 times in a year. 
• Its decisions are published after each such meeting. The committee has six members:
• Governor of RBI acts as the chairperson ex officio of MPC.