RBI Monetary Policy HIGHLIGHTS: Shaktikanta Das-led MPC decides unanimously to leave repo rate unchanged at 6.5%, raises FY24 GDP growth forecast by 50 bps
RBI Monetary Policy HIGHLIGHTS, RBI MPC Meet Dec 2023, Repo Rate: RBI Governor Shaktikanta Das announced the Monetary Policy Committee's decision to keep the repo rate unchanged at 6.5 per cent, as widely expected by economists. all-powerful MPC, headed by Governor Das, voted unanimously to maintain the status quo on the repo rate, or the key interest rate at which the RBI lends money to commercial banks, and voted 5:1 to retain the policy stance at 'withdrawal of accommodation' as it reiterated its commitment to contain inflation within 200 bps of its 4.0 per cent medium-term target.
The RBI raised its forecast for economic growth in the current financial year to 7.0 per cent from 6.5 per cent. "Growth has been resilient and robust, surprising everyone," the RBI Governor said. The December 8 RBI policy statement, released after four-day deliberations, was the first since the release of official macroeconomic data last month that showed the country's GDP expanded a much-faster-than-expected 7.6 per cent in the July-September period, aided by government spending and manufacturing, and raised hopes that Asia's third-largest economy will outperform its estimates for the financial year ending March 2024.
RBI keeps repo rate steady for 5th straight time; here is what economists say
Catch highlights of the RBI's last scheduled monetary policy review of 2023, and much more, here:
RBI Monetary Policy HIGHLIGHTS, RBI MPC Meet Dec 2023, Repo Rate: RBI Governor Shaktikanta Das announced the Monetary Policy Committee's decision to keep the repo rate unchanged at 6.5 per cent, as widely expected by economists. all-powerful MPC, headed by Governor Das, voted unanimously to maintain the status quo on the repo rate, or the key interest rate at which the RBI lends money to commercial banks, and voted 5:1 to retain the policy stance at 'withdrawal of accommodation' as it reiterated its commitment to contain inflation within 200 bps of its 4.0 per cent medium-term target.
The RBI raised its forecast for economic growth in the current financial year to 7.0 per cent from 6.5 per cent. "Growth has been resilient and robust, surprising everyone," the RBI Governor said. The December 8 RBI policy statement, released after four-day deliberations, was the first since the release of official macroeconomic data last month that showed the country's GDP expanded a much-faster-than-expected 7.6 per cent in the July-September period, aided by government spending and manufacturing, and raised hopes that Asia's third-largest economy will outperform its estimates for the financial year ending March 2024.
RBI keeps repo rate steady for 5th straight time; here is what economists say
Catch highlights of the RBI's last scheduled monetary policy review of 2023, and much more, here:
Latest Updates
RBI MPC Meet Dec 2023 LIVE Update | RBI seems comfortable that growth is not inflationary but rather real demand-led at current policy rate, says Anitha Rangan
Anitha Rangan of Equirus points out that the MPC's decision not to lower its inflation estimates suggests that the central bank is comfortable that at the current policy rate, growth is not inflationary but rather led by real demand.
"While sounding a point of caution on food inflation getting entrenched and being watchful of the second round effects, the RBI Governor also noted comfort on moderation in core and other components in headline inflation. In summary, while reiterating their stance of remaining vigilant and watchful, there was a tone of comfort with most global central banks remaining on pause. A pro-growth policy without too much worry on inflation," Rangan adds.
Read more on how economists, analysts and experts are reading the December 8 RBI policy
RBI MPC Meet Dec 2023 LIVE Update | Expect liquidity to stay comfortable, rangebound in near term but to tighten by March, says Madhavi Arora
Madhavi Arora of Emkay Global Financial Services points out that the policy outcome is "largely neutral for bonds and we see markets staying rangebound amid low year-end liquidity, with the 10-year yield hovering in the 7.20-7.30 per cent zone. However, the RBI’s consistent concern on the skewness of liquidity distribution in the banking system has now led them to allow reversal of liquidity facility under both SDF and MSF even on weekends.
"On domestic dynamics, the RBI Governor sounded positive... We however see growth easing to less than six per cent comfortably in H2 and see FY24 (growth rate) at 6.6 per cent. The RBI’s FY25 GDP forecast for first three quarters looks healthy as well," Arora says.
"Overall, the policy tone was comfortable, while MPC still insisting on keeping an eye on inflation and financial stability risk and active liquidity management. The MPC continues to stress the policy stance has to stay actively disinflationary, while supporting growth. We maintain that the RBI will stay vigilant, and it is unlikely to precede the Fed in any policy reversal in CY24," the economist adds.
RBI MPC Meet Dec 2023 LIVE Update | Forex reserves at $604 billion as of December
Reserve Bank of India Governor Shaktikanta Das mentions that the country's forex reserves stand at $604 billion, as of December 1.
RBI MPC Meet Dec 2023 LIVE Update | Central bank maintains FY24 CPI inflation projection at 5.4% citing evenly balanced risks
The Reserve Bank of India projects consumer inflation—or the rate of increase in the consumer prices of a basket of goods and services—at 5.6 per cent in Q3 and 5.2 per cent in Q4.
It pegs inflation at 5.2 per cent in the first quarter of FY25, and 4.0 per cent and 4.7 per cent in the next two quarters, respectively.
Image: Reuters
RBI MPC Meet Dec 2023 LIVE Update | Stable repo rate to keep momentum going for housing market, says property consultant
Anuj Puri of ANAROCK Group describes the December 8 policy as "an extension of the festive bonanza that the RBI gave to the homebuyers in its last policy announcement".
"It gives homebuyers yet another opportunity to make cost-optimized home purchases. Considering the present trends, the housing market is on a bull run and unchanged home loan rates will only add to the overall positive consumer sentiments. Going forward, we may expect the momentum in housing sales to continue in the wake of the unchanged repo rates coupled with the resultant stable home loan rates and positive economic outlook on India," says Puri.
Image: Unsplash
Read more on how other market voices view the December 8 RBI policy
RBI MPC Meet Dec 2023 LIVE Update | Shaktikanta Das says uncertain food prices to considerably influence inflation outlook ahead
Reserve Bank of India Governor Shaktikanta Das mentions high frequency food price indicators pointing to an increase in prices of key vegetables "which may push CPI inflation higher in the near term".
RBI MPC Meet Dec 2023 LIVE Update | Fudamentals of Indian economy remain strong, says Shaktikanta Das
Reserve Bank of India Governor Shaktikanta Das says that the fundamentals of the economy remain strong with banks and corporates showing healthier balance sheets, fiscal consolidation being on course, external balance remaining eminently manageable, and forex reserves providing cushion against external shocks.
Combined with consumer and business optimism, these factors create congenial conditions for sustained growth of the economy, he says. "Looking ahead, it is our endeavour to further build on these fundamentals which are the best buffer against global shocks in today’s uncertain world."
RBI MPC Meet Dec 2023 LIVE Update | Central bank to lay down guidelines for web aggregators of loan products to bring more transparency in digital lending, says Shaktikanta Das
RBI MPC Meet Dec 2023 LIVE Update | Most rate-sensitive stocks stay firmly in the green after RBI announcements
Financial
| Stock | CMP | Change (%) |
| LICHSGFIN | 541.05 | 4.31 |
| HDFCBANK | 1,649.00 | 1.14 |
| SHRIRAMFIN | 2,052.55 | 0.87 |
| SBICARD | 772.2 | 0.61 |
| BAJAJFINSV | 1,713.00 | 0.53 |
| CHOLAFIN | 1,142.20 | 0.44 |
| SBIN | 614.1 | 0.39 |
| ICICIBANK | 1,001.45 | 0.25 |
| AXISBANK | 1,118.35 | 0.04 |
| MUTHOOTFIN | 1,445.45 | -0.35 |
| BAJFINANCE | 7,339.00 | -0.71 |
Auto
| Stock | CMP | Change (%) |
| TIINDIA | 3,456.75 | 1.29 |
| MOTHERSON | 94.35 | 1.07 |
| BHARATFORG | 1,173.50 | 0.79 |
| TATAMOTORS | 725.7 | 0.52 |
| BALKRISIND | 2,631.00 | 0.39 |
| MRF | 1,17,842.65 | 0.37 |
| BAJAJ-AUTO | 6,090.00 | -0.06 |
| BOSCHLTD | 21,630.00 | -0.17 |
| MARUTI | 10,663.00 | -0.31 |
| EICHERMOT | 4,076.95 | -0.34 |
| SONACOMS | 574.05 | -0.55 |
| HEROMOTOCO | 3,750.00 | -0.6 |
| M&M | 1,679.90 | -0.75 |
| ASHOKLEY | 176.35 | -0.82 |
| TVSMOTOR | 1,904.25 | -0.83 |
Real estate
| Stock | CMP | Change (%) |
| PRESTIGE | 1,171.15 | 3.99 |
| LODHA | 918.05 | 2.43 |
| SWANENERGY | 463.15 | 2.42 |
| DLF | 657.65 | 1.4 |
| SOBHA | 976.55 | 0.97 |
| GODREJPROP | 1,947.90 | 0.62 |
| MAHLIFE | 532.35 | 0.47 |
| BRIGADE | 843.05 | 0.28 |
| OBEROIRLTY | 1,462.70 | -0.02 |
| PHOENIXLTD | 2,225.25 | -1.47 |
Consumer durables
| Stock | CMP | Change (%) |
| CROMPTON | 304.65 | 0.98 |
| RAJESHEXPO | 357.95 | 0.97 |
| TTKPRESTIG | 771.3 | 0.88 |
| VGUARD | 300.65 | 0.59 |
| VOLTAS | 868.75 | 0.31 |
| TITAN | 3,591.70 | 0.18 |
| AMBER | 3,093.50 | 0.15 |
| KAJARIACER | 1,380.00 | 0.12 |
| RELAXO | 911.2 | 0.08 |
| ORIENTELEC | 219.95 | 0.05 |
| DIXON | 5,990.05 | 0.03 |
| HAVELLS | 1,347.45 | -0.15 |
| BLUESTARCO | 1,006.20 | -0.59 |
| BATAINDIA | 1,645.45 | -0.82 |
| WHIRLPOOL | 1,306.55 | -1.04 |
Follow this link to catch latest updates on rate-sensitive stocks
RBI MPC Meet Dec 2023 LIVE Update | Signs of slowdown in global economy, says Shaktikanta Das
Reserve Bank of India Governor Shaktikanta Das says the global economy is displaying signs of a slowdown "though unevenly across geographies and sectors".
RBI MPC Meet Dec 2023 LIVE Update | India better placed to withstand uncertainties compared to many other economies, says Shaktikanta Das
Image: youtube.com/@reservebankofindia593
RBI MPC Meet Dec 2023 LIVE Update | Shaktikanta Das says government spending likely to further ease liquidity
RBI Governor Shaktikanta Das says that government spending will likely ease the liquidity situation in the system further.
RBI MPC Meet Dec 2023 LIVE Update | Shaktikanta Das says there is gradual turnaround in rural demand
Reserve Bank of India Governor Shaktikanta Das says that the economy is performing well and seeing a gradual turnaround in rural demand.
He also says that the manufacturing sector did well during the rainy season, owing to easing input costs, and the eight core industries (collectively referred to as infrastructure output) performed well.
RBI MPC Meet Dec 2023 LIVE Update | RBI remains committed to keep inflation within 200 bps of 4% over medium term
RBI MPC Meet Dec 2023 LIVE Update | MPC votes 5:1 to continue with 'withdrawal of accommodation' stance
Reserve Bank of India Governor Shaktikanta Das says that five out of the six MPC members voted to keep the policy stance at 'withdrawal of accommodation'.