RBI Monetary Policy Highlights: Governor Das says FY21 real GDP may remain in the negative; MPC pauses rates; loan recast for MSMEs

RBI Governor, Shaktikanta Das, announced the decisions made by the six-member Monetary Policy Committee (MPC) to revive the coronavirus-hit economy. He laid down 6 vital steps including measures to enhance liquidity and setting up of an innovation hub for the financial sector. He also mentioned that for the year 2020-21 as a whole, real GDP growth is also estimated to be negative. He also said that RBI is perhaps the only central bank in the world that has set up a special quarantine facility for continuity of critical operations. He mentioned that imports fell sharply in June reflecting weak domestic demand and low international crude oil prices. Stay tuned for all the latest updates.

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RBI MPC Meet: Key takeaways from Governor Shaktikanta Das's address

The six-member Monetary Policy Committee (MPC), headed by the RBI Governor, announced its decisions to revive the coronavirus-hit economy today.

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Repo rate remains unchanged at 4%, says Governor Shaktikanta Das

The Reserve Bank of India (RBI) on Thursday opted for a status quo and left interest rates unchanged, but maintained an accommodative stance, implying more rate cuts in future if the need arises to support the economy hit by the Covid-19 crisis.

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RBI announced a relaxation on loan-to-value (LTV) ratio for gold loans from 75 percent to 90 percent

Abundant liquidity has helped mutual funds. We will take more steps to enhance liquidity aid for financial markets, says Governor Das

RBI's steps to enhance liquidity aid for the country's financial market

1. Mutual funds have stabilised since Franklin Templeton issue

2. To take more steps to enhance liquidity aid for financial markets

3. To further ease financial stress caused by COVID-19 disruptions

4. Fully mindful of need for stability of financial sector

5. To give liquidity of Rs 10,000 cr to NABARD, NHB at repo rate

Governor Das announces special window under the June 2019 circular based on resolution

1. Special window for cos under June 7, 2019 circular on resolution

2. Formed panel for suggesting resolution parameters

4. Stressed MSMEs remain eligible for debt restructuring

5. Formed panel for suggesting resolution parameters

6. Loan-to-value on gold loans raised to 90%

7. Reviewed priority sector loan norms

RBI to set up innovation hub in India for the financial sector

Transmission of rate cuts has been better. Abundant liquidity has supported segments like MFs, says Governor Das

Even for the lowest investment grade bonds, the spreads have come down significantly, says Shaktikanta Das

6 measures by MPC to revive economy

1. Enhance Liquidity support for financial markets

2. Reduce stress on economic sector caused by Covid-19 and strenghthening credit discipline

3. To improve flow of credit

4. Deepen Digitalpayment system

5. Augment customer safety in Cheque payments

6. Facilitate innovations accross Finance sector

Easing of financial conditions has enhanced transmission, says Das

RBI is perhaps the only central bank in the world which has set up a special quarantine facility for continuity of critical operations, says Governor Shaktikanta Das

Imports fell sharply in June reflecting weak domestic demand and low international crude oil prices, says Das

For the year 2020-21 as a whole, real GDP growth is also estimated to be negative: Das

"Taking into consideration all factors, the GDP growth in the first half of the year is estimated to remain in the contraction zone. For the year 2020-21 as a whole, real GDP growth is also estimated to be negative," he said.

"But any positive news on Covid-19 containment efforts will change the scenario," said RBI governor Shaktikanta Das'

While space for further monetary policy action is available, it is important to use it judiciously to maximise the beneficial effects on the underlying economy, says Governor Das.

Global economic activity has remained fragile in first half of 2020: RBI Governor Shaktikanta Das

All the MPC members unanimously voted in favour of keeping rates unchanged, says Das

Repo rate remains unchanged, announces Governor Shaktikanta Das

WATCH LIVE | RBI Governor Shaktikanta Das addresses the media

'Participants are keeping a close eye on the RBI policy outcome'

Participants are keeping a close eye on theRBIpolicy outcome and that would set the tone for the rest of the day as well, said Ajit Mishra, VP - Research, Religare Broking

Domestic equity benchmark Sensex jumped over 150 points in opening session on Thursday ahead of the Reserve Bank of India's monetary policy outcome.

The BSE Sensex was trading 183 points or 0.49 per cent higher at 37,846.33; while the NSE Nifty was up 52.70 points or 0.47 per cent at 11,154.35.

(PTI)

Here are 4 things to watch out for from the RBI's MPC statement

The Reserve Bank of India’s policy decision this week is a tricky one to call, with economists split over whether Governor Shaktikanta Das will lower interest rates again to support a fragile economy and banking sector in the face of above-target inflation.

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RBI Committee meeting postponed to 12 pm

The RBI meeting is postponed to 12 pm today.

The central bank has been taking steps proactively to limit the damage to the economy caused by the pandemic and subsequent lockdowns.

It is to note that GovernorDas has recently turned his attention toward the fragile financial sector amid forecasts for a sharp rise in bad loans.

RBI likely to cut interest rates despite inflation risk

India's worsening economic outlook as coronavirus cases soar has raised the chance the Reserve Bank of India (RBI) will cut interest rates at its policy review on Thursday, in spite of inflationary pressures.

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