''Policy Support To Continue For Economy, Inflation To Be Monitored'': RBI Governor

RBI Monetary Policy Committee (MPC) Minutes: RBI Governor Shaktikanta Das said that the central bank will maintain an accommodative stance for as long as necessary to support the economy

Continued monetary policy support for economic revival amid the COVID-19 pandemic is necessary while remaining watchful of inflationary pressures, Reserve Bank of India (RBI) Governor Shaktikanta Das said in the minutes of the latest monetary policy committee (MPC) meeting. RBI Governor underlined the need for closely monitoring the price hike situation in order to anchor the inflation expectations, according to MPC minutes released on Friday, August 20. "The need of the hour is twofold: first, continue the monetary policy support to the economy; and second, remain watchful of any durable inflationary pressures and sustained price momentum in key components so as to bring back the CPI inflation to four per cent over a period of time in a non-disruptive manner," said RBI Governor Shaktikanta Das. However, MPC member Jayant Varma said that the borrowing rate should be revised. The current reverse repo rate was inappropriate and should be brought closer to the repo rate to anchor inflation expectations better, according to Mr Varma.