RBI 5th Bi-Monthly Monetary Policy Review 2016-17 Highlights

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Taking everyone by surprise, Reserve Bank of India’s Governor Urjit Patel today kept the Repo rate unchanged in RBI's 5th Bi-Monthly Monetary Policy review, even as the central bank lowered GDP growth rate to 7.1 per cent and short term disruption in economic activities due to demonetization. Here are the major highlights of RBI's 5th Bi-Monthly Monetary Policy Review.

 RBI Monetary Policy Review Highlights 2016-17

• Repo rate unchanged at 6.25%, Reverse repo at 5.75%
  
• Cash reserve ratio or CRR unchanged at 4%
• Cuts growth forecast to 7.1%, from 7.6% for this fiscal
• Inflation target remains 5% for March 2017, upside risk
• Demonetisation to lower prices of perishables, could reduce inflation by 10-15 basis points by December
• All MPC members voted in favour of status quo in policy
• Demonetisation to result in short-run disruptions in cash-intensive sectors
• Crude price volatility, surge in financial market turbulence could put March end inflation target at risk
• Foreign exchange reserve rose to all-time high of $364 billion on December 2
• RBI injected Rs. 1.1 lakh crore liquidity through OMO purchases this fiscal
• This is the first monetary policy review after De-monetization. 
• This was the second monetary policy review headed by Urjit Patel after he took charge as the RBI Governor in September this year. 
• In the last policy review in October, the RBI cut the repo rate by 0.25% to 6.25%.
• Next monetary policy on February 8.

Check latest RBI Policy Rates with explanations from here

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