RBI governor says October retail inflation expected to be ‘under 7%’
October retail inflation expected to be ‘less than 7%’, says RBI governor
Reserve Bank Governor Shaktikanta Das on Saturday expressed confidence that India will continue to be the fastest growing major economy with a potential growth rate of 7% in 2022-23, on the back of strong macroeconomic fundamentals and financial sector stability.
Speaking at the HT Leadership Summit 2022, Mr. Das emphasized that the country’s economy, supported by the banking and non-banking sectors, remains resilient.
Shri Das said that the whole world has faced many setbacks. “I call this the triple shock of the COVID-19 pandemic, then the war in Ukraine, and now the financial market turmoil.”
The RBI governor said that the turmoil in the financial market is primarily arising from the tightening monetary policy by central banks across the world, especially in advanced countries, led by the US Fed, and spillovers by emerging market economies including India. is being felt. ,
He further said that in such constant turmoil, the EU is facing a recession, but there are chances that it will survive it. The US is stable, but there are other countries where growth has slowed.
“As far as India is concerned, the economy, the overall macroeconomic fundamentals, the stability of the financial sector, all these aspects remain resilient. The banking sector which is the financial sector, all parameters with respect to banking or non-banking lenders or other major financial sector players,” he said.
He said that in the present context the growth figures are looking good.
He said, “We estimate that India will grow at around 7%. IMF has estimated that India will grow at around 6.8% in the current year. And this will make India one of the fastest growing major economies of the world. makes.”
However, Mr. Das said that India faces a major challenge with respect to inflation.
Retail inflation rose to 7.4% in September from 7% in August on higher food and energy costs.
He said, “We expect the October numbers that will be released on Monday … to be less than 7%. Therefore, inflation … is a concern with which we are now effectively tackling and dealing with Huh.”
The Governor also said that India is taking over the presidency of the G20 at a time which is perhaps the most challenging year in modern times.
Mr Das said that India is assuming the presidency of the G20 with stronger macroeconomic fundamentals than many other countries.
Referring to comments made in some quarters that the RBI is using foreign exchange reserves indiscriminately, Mr Das said “it is not so”. He said that reserves are being accumulated for ‘rainy days’.
“And when it rains, I’ve said before, you have to pick up your umbrella and use that. We haven’t taken a reserve in the Reserve Bank of India just to have it as a showpiece. And even That even at this point in time, our reserves are very comfortable,” he said.
India’s forex reserves declined by $1.087 billion to $529.994 billion in the week ended November 4 due to a sharp fall in gold reserves.
In October 2021, the country’s foreign exchange kitty reached an all-time high of $645 billion.