This week’s Banking brief post is about RBI’s Bi-monthly Monetary Policy. In RBI’s 24th Monetary Policy Committee meeting major decisions regarding key policy rates, one-time restructuring of loans, guidance on growth and inflation were taken.
Not only did the Monetary Policy Committee of the Reserve Bank of India decide to hold rates but also announced additional liquidity boosters to tackle the ongoing economic crisis.
On the growth front, the resurgence of COVID cases in August has meant that the economy is likely to be subdued for the entirety of 2020-21. The RBI has recognized this impact and therefore, expects real GDP growth to remain in the contraction zone for the first half of 2020-21 and continue to remain negative for the entirety of the financial year 2020-21.