The Reserve Bank of India has scheduled its monetary policy meet this month which began on 4th October 2023 and will conclude on 6th October 2023. RBI Governor Shaktikanta Das will make announcements related to Monetary Policy meet on 6th October 2023 at 10.00am.
The Monetary Policy Committee will discuss about the current economic situation and decide on the future course of the monetary policy.
RBI Monetary Policy Report of August
In August 2023, India’s Monetary Policy Committee decided to keep the benchmark repo rate unchanged for third meet. The interest rates on housing and car loans did not change due to that. Even though the Consumer Price Index increased to three month high of 4.81 percent in June 2023, but the committee did not change the repo rate in the month of August.
Who is Conducting the Monetary Policy Meet in October 2023??
Governor Shaktikanta Das is the ruling person of the Monetary Policy Committee which has six members. The other members are RBI Deputy Governor Michael Debabrata Patra, RBI Executive Director Rajiv Ranjan, and Shashanka Bhide, Honorary Senior Advisor at National Council of Applied Economic Research in Delhi, Ashima Goyal, Emeritus Professor at Indira Gandhi Institute of Development Research in Mumbai, and Jayanth R. Varma, Professor at Indian Institute of Management in Ahmedabad.
Monetary Policy Committee
The Monetary Policy Committee helps for taking crucial decision for beating inflation that too with a specific target. It is established with the intention of setting the benchmark policy interest rate. The technical advisory group provides assistance to RBI Governor to take decisions related to monetary policy.
Motive of Monetary Policy
Financial Policy has the goal of ensuring fair price stability, strong employment and a quicker pace of economic growth.
Monetary Policy helps in
- Balancing the Economic Cycle
- Provide Fair level of Price Stability
- Quick Economic Growth
What to Expect from the Monetary Policy of October 2023??
While experts are not expecting any rate change in this meet. Some experts believe that there could be no changes in rate, but liquidity is going to be the center of the policy and RBI might continue to keep the liquidity tighter. Experts also said that as per the current market dynamics it is very difficult for the inflation rate to fall below 5%. The vegetables prices have corrected in the current scenario. But the crude prices have gone up but there is no immediate effect on the petrol and diesel prices. But still the prices of pulses are surging. RBI will now be forecasting for FY 2024-25. There could be no changes with the rates but liquidity management is a bit tricky task for the Government. Also there is uncertainty about how the dollar inflows will be. So it could either be a source of liquidity or it could another tool to drain liquidity going forward. Also festive seasons coming ahead there could be currency leakage , here experts believe that RBI should not take very harsh steps to curb liquidity.