new Delhi: The Reserve Bank of India (RBI) has cut its growth forecast for the monetary policy review meeting. It has now come down from 7.8 per cent to 7.2 per cent. At the same time, there has been no change in key interest rates. After the meeting, Governor Shaktikanta Das said on Friday that a war between Russia and Ukraine could lead to a global recession. “We have to focus on controlling inflation,” he said at a press conference after the first monetary policy review for the fiscal year 2022-23. We have to be very careful at this time but we also have to be prepared to respond to the imminent threat. The Monetary Policy Committee of the Reserve Bank of India has also voted unanimously to maintain a soft stance.

No change in key interest rates

He said that in view of the current situation, all the major interest rates are not being changed. Repo rate, reverse repo rate and CRR will remain the same. He said that the repo rate has been kept at 4% and the reverse repo rate at 3.35%. Meanwhile, the trend of bullishness in the stock market continues.

War increases inflation

“Now, two years later, as we emerge from the pandemic, the war in Russia and Ukraine since February 24 has seen a dramatic change in the world economy,” he told a news conference. It sounds like a knock on the door. Das said the two-month war stifled growth and pushed up inflation. Ahead of the RBI’s currency review, most analysts expected the Reserve Bank to maintain interest rates to support growth.

inflation forecast

Das said inflation is now estimated at 5.7 per cent. At the same time, there has been no hike in MSF and bank rates. However, the growth rate is expected to be low. Das said the RBI has raised its GDP forecast for FY13 to 7.2% from the previous estimate of 7.8%.