RBI's Das: Economy needs a larger push
- RBI Governor Das argues that economy needs a larger push.
- MPC member Patra notes every indicator of economic activity is worsening.
According to the minutes of the Reserve Bank of India's August Monetary Policy Committee (MPC) meeting, at which the bank announced a 35 basis points cut to its policy rate, Governor Shaktikanta Das said that the economy needs a larger push.
With the initial market reaction, the USD/INR pair inched higher and was last seen trading at 71.565, adding 0.05% on a daily basis. Below are some additional key takeaways from the statement as reported by Reuters.
"Das says impact of monetary policy easing, favourable base effects expected to support gdp growth especially in H2.""
"Das says transmission to bank lending rates has been inadequate, though it is expected to improve in coming weeks and months."
"MPC member Dholakia says fiscal slippage is not a matter of serious concern for the rest of the year."
"MPC member Dholakia says currently inflation does not appear to be a concern in the next 3-4 quarters at least."
"MPC member Dholakia says there is enough policy space to cut policy repo rate to correct the high real interest rate in the economy."
"MPC member Dholakia says would like to cut policy rate by 40 bps but don't mind going with majority vote of 35 bps."
"MPC member Patra says virtually every indicator of activity is turning down."
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
