RBI Governor speaks at CII annual session: The governor further said that inflation has moderated but there is no room for complacency.
RBI Governor speaks at CII annual session: India’s economic growth in the current fiscal (FY23-24) will be close to 6.5 per cent, the Reserve Bank of India (RBI) Governor Shaktikanta Das said at the annual session of Confederation of Indian Industry (CII) on May 24, 2023. The governor further said that inflation has moderated but there is no room for complacency.
Speaking at an event organised by the industry chamber CII, Das said there is a suggestion that RBI will take a pause in the coming monetary policy meetings, “It’s not in my hands. It all depends on the situation on the ground. I am driven by what’s happening on the ground. What is the outlook on ground? What are the trends? How is the inflation buildup or the inflation softening? So, it’s all there.
“So, it’s not a decision which is entirely in my hands, because I am driven by what’s happening at the ground level. So, to that extent, you know, I think I will leave it at that,” the Governor said.
According to him, the next inflation print is expected to be lower than 4.7 per cent. The inflation based on the consumer price index was 4.7 in April.
Read More: SBI General unveils Surety Bond Bima insurance product for infrastructure projects
At the CII event, he said that corporates have deleveraged themselves in comparison to pre covid and RBI’s endeavour is to ensure the stability of the exchange rate. According to him, there is geopolitical pressure on the global economy, “Central Banks across the world have continued to tighten the monetary policy at a much slower pace relative to the aggressive 75 basis points (bps) which were witnessed in 2022, while some central banks have taken a pause, global monetary policy is still settling down as the inflation conditions are fast evolving,” said Das.
He added, due to the US banking crisis, the global financial system has been severely tested and the outlook has been adversely affected in the advanced economy.
Read More: Gold Prices Rise In India On May 24; Check New Rates Of 22 Carat Gold In Your City
According to the RBI governor, banking turmoil in the US and Switzerland is a confluence of rising interest rates and unrealized losses in debt securities’ portfolio. “Co-existence of high inflation and banking stress is complicating the responses of the central bank as they face a trade-off risk between either straining the global markets or having to tolerate longer periods of high inflation,” said Das.
He said that amidst these global uncertainties, too the Indian global banking system remains stable and resilient with stable capital and liquidity positions, improving asset quality, better provisioning coverage, and improved profitability.
He also informed the gathering that the RBI is fine-tuning the Central Bank Digital Currency (CBDC) architecture based on the experience so far.
