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RBI projects India’s FY23 retail inflation at 4.5%

India’s FY23 retail inflation is projected at 4.5 percent, said Reserve Bank of India (RBI) Governor Shaktikanta Das on Thursday.

Besides, inflation projection for 2021-22 is retained at 5.3 percent, with Q4FY22 at 5.7 percent on account of unfavorable base effects that are expected to ease subsequently.

In his policy statement post the Monetary Policy Committee’s bi-monthly meeting, he said: “The CPI reading for January 2022 is expected to move closer to the upper tolerance band, largely due to adverse base effects.

“Taking all these factors into consideration and on the assumption of a normal monsoon, CPI inflation for 2022-23 is projected at 4.5 percent with Q1:2022-23 at 4.9 percent; Q2 at 5.0 percent; Q3 at 4.0 percent; and Q4 at 4.2 percent, with risks, broadly balanced.”

On Thursday, the RBI retained its key short-term lending rates during the sixth and final monetary policy review of FY22.

Further, the growth-oriented accommodative stance was retained to give a push to economic activity.

In addition, the RBI’s Monetary Policy Committee (MPC) maintained the repo rate, or short-term lending rate, for commercial banks, at 4 percent.

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