On Friday, the Reserve Bank of India (RBI), governor, Shaktikanta Das, announced a slew of measures to revive the Indian economy. The COVID-19 pandemic and its subsequent lockdown have had a huge repercussion which the central bank is trying to fix through various measures. This is the third set of measures announced by the central bank in this regard.
Ten quick facts of May 22 press briefing:
GDP growth to remain negative in FY 20-21, some pick up seen in second half of FY21.
From immediate effect, the repo rate has been cut by 40 bps to 4.0 per cent from 4.40 per cent.
The reverse repo rate stands reduced to 3.35 per cent from 3.75 per cent.
The Monetary Policy Committee decided to continue with the accommodative stance.
Moratorium extension for another three months.
Domestic economic activity has been impacted severely by the lockdown which has extended over the past two months.
The only silver lining was provided by agriculture, with the summer sowing of rice, pulses and oilseeds in the country progressing well.
The inflation outlook is highly uncertain.
The macroeconomic impact of the pandemic is turning out to be more severe than initially anticipated, and various sectors of the economy are experiencing acute stress.
Other than agriculture, other economic activities are more likely to remain depressed in the first quarter of 2020-21 in view of the extended lockdown.