RBI expected to hike policy rates for 3rd time in row in fight against inflation
India's inflation currently stands at 7 per cent and finance minister Nirmala Sitharaman said earlier this week that government has been trying to keep it under 6 per cent.
Amid the battle against inflation, the Reserve Bank of India is expected to hike policy rates for the third time in a row on Friday as the central bank’s governor, Shaktikanta Das, addresses a briefing at around 10 am.
The government has been trying to keep the inflation rate below 6 per cent, finance minister Nirmala Sitharaman said earlier this week. The current rate of inflation is at 7 per cent.
In reply to a debate on prise rise in Parliament, the finance minister said that the macro economic fundamentals of the country are strong, adding that “as compared to the peer group nations, emerging and advanced economies.”
Meanwhile, since May, the RBI has raised rates twice and is expected to hike rates again. It is being anticipated that the hike may range between 25-50 basis points. The country's retail inflation has shown some signs of easing in recent months.
The second bi-monthly meeting of the RBI Monetary Policy Committee started on Wednesday.
In June, India’s retail inflation marginally eased for the second month in a row to 7.01 per cent, but consumer prices, which rose 7.04 per cent in May, continued to breach the Reserve Bank of India’s upper limit of 6 per cent for the sixth straight month. Food items were costlier in urban India, where inflation stood at 8.04%, although they were even higher in May at 8.20%. In rural India, food prices rose 7.61%, HT had reported.
Worldwide, many nations have been registering new records with prices of essentials soaring high. The pandemic and then the Ukraine war have aggravated the conditions.
In Australia, the inflation level is at the highest level in decades. South Korea has registered the highest figures in 24 years, while in Pakistan, the inflation rate has seen the steepest hi in 14 years.
(With inputs from ANI, Reuters)