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financial year.
“Since the pandemic, the RBI has continued to maintain an accommodative stance prioritising a sustained economic growth recovery. Currently, India’s key growth indicators are at a nascent stage of recovery and there is still a slack in the economy. The escalating inflation in the economy arising from global commodity price rise and its transmission to the consumer prices would further add downward pressure to domestic growth trajectory. Thus, amidst the inflationary pressure and growth uncertainty, in our view the RBI is likely to keep the key policy rate unchanged in its April 2022 review,” said Shishir Baijal, chairman and managing director at Knight Frank India.
On inflation, economists expect RBI to raise its retail inflation projection for the new fiscal year by 50 to 80 basis points from the current 4.5 per cent. “At the margin, inflation risks dominate the downside risk to growth. On our estimates, it will average above 6 percent in FY23 , so we see the 6 percent upper band getting breached for three consecutive quarters,” Sonal Varma, managing director & chief economist at Nomura, told.
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