RBI maintains FY22 GDP outlook at 10.5%, flags Covid-19 second wave as key risk

RBI Governor Shaktikanta Das said the central bank maintained its FY22 GDP growth outlook for economy at 10.5% but flagged the spike in Covid-19 as a key risk

NEW DELHI

The Reserve Bank of India (RBI) Governor Shaktikanta Das, on Wednesday, said the central bank maintained its real GDP growth projection for the financial year 2021-22 (FY22) at 10.5%.

Governor Das, who heads the RBI’s Monetary Policy Committee (MPC), said the committee also decided to keep repo rate unchanged at 4%. It is the rate at which the central bank lends to banks. Das said RBI will remain accommodative “as long as necessary” to sustain growth on a durable basis.

He also cautioned that localised and regional lockdowns could dampen recovery, adding that the recent spike has brought uncertainty.

Quoting Martin Luther King Jr, the central banker said, “We must accept finite disappointment but never lose infinite hope”, as he reiterated the RBI’s support to the economy as the second wave of pandemic threatens to derail the recovery.

Agencies