Amid increased uncertainty regarding the outlook for inflation and growth owing to Russian-Ukraine crisis, the MPC today decided to stay course on its pro-growth stance even as evolving global dynamics compelled an upward revision to its inflation projection and a return to pre-pandemic policy rate corridor.
The RBI turned the policy corner, turning more hawkish in today's policy. While the repo rate and stance were unchanged, the central bank normalised the policy corridor (with the introduction of SDF at 3.75%) and said it will focus on withdrawal of accomodation. Recognising inflationary risks, the RBI raised its inflation to 5.7% (up by 120 bps) and lowered its growth forecast to 7.2%