RBI’s Second Bi – Monthly Monetary Policy for 2017-18

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RBI’s Second Bi – Monthly Monetary Policy for 2017-18

Reserve Bank of India (RBI) has published its Second Bi- monthly Monetary Policy Rates in Mumbai on June 7th, 2017. The Second Bi-monthly policy has been released based on the assessment of the Monetary Policy Committee of the Reserve Bank of India (RBI). 

Present Member’s of the Monetary Policy committee:

  • Urjit Patel, Governor of RBI.
  • Michael Patra, Executive Director of RBI
  • Rama Subramaniam Gandhi, Retired Deputy Governor of RBI
  • Pami Dua, Director at Delhi School of Economics
  • Ravindra Dholakia, An economics professor of IIM Ahmadabad
  • Chetan Ghate, Professor at Indian Statistical Institute.

Main Highlights of Second Bi – Monthly Monetary Policy:    

  • Repo rate unchanged at 6.25%.
  • Reverse repo unchanged at 6%.
  • Statutory Liquidity Ratio cut by 0.5% to 20%.
  • Growth forecast for 2017—18 lowered to 7.3% from 7.4%.
  • Inflation projected at 2-3.5% for first Half of the financial year 2017-18 and 3.5-4.5% for second half of the financial year 2017-18.
  • Implementation of the GST is not expected to have any material impact on overall inflation.
  • RBI to work with government to address stress in bank balance sheet.
  • Implementing allowances under 7th pay commission have been identified as upside risk to inflation.
  • Need to revive private investment, restore banking sector health, remove infrastructure bottleneck.
  • Next Monetary Policy Committee meeting scheduled on 1 and 2 August.

Present Current Rates are given as below:

Current RatesRemarks

Policy Rates

Policy Repo Rate6.25%Unchanged
Reverse Repo Rate6.00%Unchanged
Marginal Standing Facility Rate (MSF)6.50%Unchanged
Bank Rate6.50%Unchanged

Reserve Ratios

Cash Reserve Ratio (CRR)4%Unchanged
Statutory Liquidity Ratio (SLR)20.00%Changed.

Reduced 0.50% from earlier 20.50%.

 

 

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