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First RBI monetary policy review after demonetisation: Urjit Patel brings no respite to borrowers; keeps interest rates unchanged

Urjit Patel-led 6-member Monetary Policy Committee, which had in its first policy review cut interest rate by 0.25 percent in October, belied expectations to keep benchmark repo rate unchanged at 6.25 percent unanimously.


First RBI monetary policy review after demonetisation: Urjit Patel brings no respite to borrowers; keeps interest rates unchanged

New Delhi: Reserve Bank of India (RBI) on Wednesday kept the interest rates unchanged which will bring no respite to home, auto and corporate borrowers.

The 6-member Monetary Policy Committee, headed by RBI Governor Urjit Patel, kept the repo rate or the short term rate at which central bank lends to banks unchanged at 6.25 percent and reverse repo rate at 5.75 percent.

This is RBI's first monetary policy review after demonetisation of old Rs 500 and Rs 1,000 currency notes.

Here are the live updates

RBI Governor Urjit Patel addresses press conference soon after the announcement of monetary policy. Here are the key highlights:

 

No fundamental trust deficit, most people think its good decision as it fights fake currency, black money and terrorism

Consequences of demonetisation were taken on board; all efforts were made to mitigate problems

When the situation normalises, limits on withdrawals will be removed

No decision taken so far to reintroduce Rs 1000 notes: Gandhi

Between November 10 and December 5, RBI supplied 19.1 billion pieces of denominations to public, which is more than total of last 3 years: Dy Guv Gandhi

See no implication of demonetisation on RBI's balance sheet

On Demonetisation: The decision was not taken in haste. Can meet demand of public given the availability of notes. Old notes worth 11.55 lakh crore are back in the banks

Recalibrated presses in past two weeks to print more Rs 500 and Rs 100 notes

RBI and Central Govt's note printing presses are working at full capacity, says Deputy Governor R Gandhi

Govt has pro-actively responded with increasing Market stabilisation scheme limit to Rs 6 lakh crore

Given the October rate cut, a further rate cut was not warranted at this juncture

7th Pay Commission disbursements have not been disruptive to inflation outcomes

7th Pay Comm disbursements may affect inflation in next financial year

Inflation outcome in September and October vindicates current stance

Demonetisation to result in short-run disruptions in cash-intensive sectors like retail, hotels, restaurants and transportation

RBI policy on interest rate has nothing to do with forthcoming US Federal Reserve decision

RBI maintains 'accommodative' policy stance'; to withdraw incremental CRR from December 10

Note ban may bring down CPI by 10-15 bps in October-December

Currency in circulation plunged by Rs 7.4 lakh crore up to December 2

Monetary Policy highlights

The benchmark BSE Sensex slipped into negative terrain and plunged almost 228 points to 26,164.82 on selling pressure soon after the policy announcement

The NSE Nifty cracks below the 8,100-mark

All six members of the Monetary Policy Committee voted in favour of status quo

Monetary stance remains accommodative, says RBI

Withdrawal of old notes could result in temporary reduction in inflation by 10-15 bps in third quarter: RBI

RBI lowers GDP growth estimate to 7.1 percent in 2016-17 from earlier projection of 7.6 percent

Retail inflation to be 5 percent in fourth quarter of current fiscal: RBI

On the domestic front, the growth of real gross value added (GVA) in Q2 of 2016-17 turned out to be lower than projected on account of a deeper than expected slowdown in industrial activity, says RBI

Global growth picked up modestly in the second half of 2016, after weakening in the first half: RBI

International financial markets strongly impacted by the result of the US presidential election: RBI

Marginal standing facility (MSF) rate and the Bank Rate at 6.75 percent

RBI keeps Repo Rate unchanged at 6.25 percent

Reverse repo rate under the LAF remains unchanged at 5.75 percent

 

From Zee News

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