RBI hikes Repo rate by 40 bps:- In a key announcement, Reserve Bank of India Governor Shaktikanta Das said that the key interest rate is increased by 40 basis points to 4.40 percent immediately. The key decision was taken by the Monetary Policy Committee (MPC) of the Central Bank meeting that was held between May 2nd and 4th. Shaktikanta Das said that the decision was taken in the view of the rising inflation, huge crude oil prices, geo-political tensions and the shortage of the basic commodities globally. He said that they had an impact on the Indian economy. Shaktikanta Das said that RBI will always continue to remain accommodative.
Shaktikanta Das addressed the media for half-an-hour and he said that the food inflation is expected to be high as there is a global shortage for wheat. He said that the oil prices soared up because of the Russia and Ukraine war. There are export restrictions on many major producing countries and the prices of the essential commodities have reached high. The RBI also decided to hike the CRR by 50 basis points and this will withdraw Rs 87,000 crores from the banking system. The average surplus liquidity in the banking system is at over Rs 7 lakh crores in April told Shaktikanta Das.