Ahead of the Reserve Bank of India’s fortnightly August monetary policy tomorrow, August 6, Devanshi Ashar, analyst at Zee Business Research, citing experts, pointed out that inflation rates, liquidity issues and Governor Shakitkanta Das’ comments will be more central to this policy.
The central bank’s Monetary Policy Committee (MPC) is expected to issue its decision on August 6, 2021, which has been under discussion since August 4, 2021.
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Ashar says RBI MPC’s policy would be primarily a non-event, however, experts are eager to know what the inflation rates would be and what changes could be seen in the rates and the governor’s comment announcing the decision. of the MPC.
Experts are also watching closely that there will be a step to reduce the excess liquidity seen in the market and how bond yields will ultimately be managed by the central bank.
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The majority of analysts believe that the MPC would remain ‘status quo’ on rates and continue to maintain an accommodative position. Likewise, they believe that the position would be the same for the next coming policies.
Analysts are also eager to see if there will be a change or revision in the CPI (consumer price inflation) figures for fiscal 22, and the majority of them mention that the rates of inflation would be the key to watch during this policy.
Current inflation rates of 5.1 percent are expected to be revised to 5-5.2 percent for FY22 and would increase slightly in the second half of FY22.
In addition, a third of total analysts believe that there will be no revision of GDP (gross domestic product), while 25 percent believe that fiscal year 22 GDP will be probably revised.
There will be no indication of liquidity during this policy as there is still a lot of uncertainty in the market, analysts believe, and believe that liquidity will be withdrawn from the market after December.