Contact Your Financial Adviser Money Making MC
16 Aug 2018
 |
RBI
(The Total Investment & Insurance Solutions)
RBI
Governor Urjit Patel voted for a rate hike at its policy meet earlier this
month as a step towards keeping inflation below the mandated 4 per cent mark on
a "durable basis", according to the minutes of the meeting released
today.
Five
of the six members of the all-powerful Monetary Policy Committee headed by
Patel had voted for a 25 basis points hike in the benchmark lending rate (repo)
on August 1. The Total Investment &
Insurance Solutions
It
was RBI's second consecutive hike in the repo rate, which has risen to 6.5 per
cent. The central bank had hiked the rate at its June policy meet as well.
"As
inflation risks have continued to be elevated, I vote for an increase in the
policy repo rate by 25 basis points; this action is a necessary step towards
securing the mandated 4 per cent inflation target on a durable basis,"
Patel opined. The Total Investment
& Insurance Solutions
However, in view of several uncertainties
that are present, "I maintain the neutral stance of monetary policy",
the RBI Governor added.
RBI
Deputy Governor Viral Acharya too voted for a hike in the policy rate as a step
towards fulfilling inflation targeting mandate while paying attention to
growth. The Total Investment &
Insurance Solutions
"...there
is an important interim uncertainty in the form of tariff wars which can rock
global growth, financial markets and inflation in abrupt and unexpected ways, I
vote to retain the neutral stance of monetary policy," Acharya said.
The
minutes further said RBI Executive Director Michael Debabrata Patra said the
economy was poised for an acceleration of growth in 2018-19 relative to
2017-18, but the drivers of growth are amorphous at this juncture.
He
said softer inflation prints expected in the second quarter of the fiscal could
likely lull inflation expectations, but abundant precaution and decisiveness in
quelling risks to the target is warranted if the hard-earned gains in terms of
macroeconomic stability and credibility have to be preserved.
IIM
Ahmedabad Professor Ravindra H Dholakia was the only MPC member who did not
favour a rate hike. The Total
Investment & Insurance Solutions
"This
is certainly not the time and environment to hike the policy rate. Nor is it
the time to tinker with the policy stance. Prudence lies in maintaining status
quo on both," he said. The Total
Investment & Insurance Solutions
The fourth bi-monthly MPC
meeting of the current fiscal is scheduled from October 3-5 here. The
Total Investment & Insurance Solutions
No comments:
Post a Comment