Lagatar24 Desk
New Delhi, April 8: While retaining its accommodative approach, the Reserve Bank of India (RBI) decreased its actual Gross Domestic Product (GDP) growth prediction for the current Financial Year 2022-23 to 7.2 percent, down from 7.8 percent previously.
The inflation prediction for FY 2022-23 has also been raised from 4.5 percent to 5.7 percent.
“Real GDP growth for the year 2022-23 is now projected at 7.2 per cent; with Quarter 1 of FY 2022-23 at 16.2 per cent, Quarter 2 at 6.2 per cent, Quarter 3 at 4.1 per cent and Quarter 4 at 4 per cent,” said RBI Governor Shaktikanta Das, in his Monetary Policy Statement.
Inflation, which is expected to be 5.7 percent in 2022-23, is expected to average 6.3 percent in Q1, 5% in Q2, 5.4 percent in Q3, and 5.1 percent in Q4.
During the years 2020-23, the projections were changed to assume that crude oil will be in the Indian basket at USD 100 per barrel.
Meanwhile, according to the National Statistics Office’s Second Advance Estimates released on February 28, Real GDP increased by 8.9% in 2021-22.
“Private consumption and fixed investment, however, remain subdued with these two components being only 1.2 per cent and 2 per cent respectively, above their pre-pandemic levels,” Das said.
Apart from maintaining the current interest rate of 4%, the Reserve Bank has chosen to restore the width of liquidity adjustment facilities, or the LAF corridor, to 50 basis points, as it was prior to the pandemic. To “ensure liquidity,” this has been done. Das also stated that India’s foreign exchange reserves are at a very safe level.
