Mumbai: The Reserve Bank of India (RBI) Governor Shaktikanta Das has expressed concerns over elevated food inflation in the country. He said that the country needs to closely monitor food price inflation. Additionally, the RBI governor said that he expects a normal monsoon this year, which will help control the elevated food prices. He has projected inflation to be 4.5 per cent for the financial year 2024-25.
RBI’s Inflation Projection
Q1 – 4.9 per cent
Q2 – 3.8 per cent
Q3- 4.6 per cent
Q4 – 4.5 per cent
What is the RBI’s inflation target?
The RBI governor said that the apex bank is committed to keeping inflation at 4 per cent on a durable basis. The central bank has set a target of 4 per cent inflation in the country with 2 per cent leeway. The RBI’s inflation band stretches from 2 per cent to 6 per cent at both its end.
What is the RBI method to control inflation?
The apex bank uses monetary policy tools like Repo rate, Revese repo rate, Cash reserve ratio (CRR), Statutory liquidity ratio (SLR), etc to control inflation and deflation in the economy. The central bank uses these tools to increase or reduce money into circulation in the economy, which in turns impacts inlaftion.
How much is the Repo Rate?
The MPC kept the repo rate unchnaged at 6.50 per cent for eight time in a row on June 07, 2024. According to latest data available with the government. The retail inflation was 4.83 per cent in April 2024. Overall, retail inflation has continued to remain low mainly because of low core inflation. It is headline inflation which continues to remain a hedache for the government.
But its food inflation which remains a headache for the RBI and the government. Vegetable inflation in April 2024 was at worrisome levels of 27.80 per cent. Recently, vegetable prices have gone through the roof because of severe heat waves witnessed in the ongoing summer season. The blistering temperature has played a spoilsport in storage of food items resulting in damage and lower supply in the market.
RBI MPC Meeting 2024: The RBI Governor Shaktikanta Das said that inflation will remain at 4.5 per cent in FY25. He said that the apex bank is committed to keeping inflation at 4 per cent on a durable basis. Economy Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
