RBI Governor told when the EMI burden on people will reduce, Indian economy will grow at the rate of 6.5% in the financial year
On behalf of the RBI governor, it was said that the Indian economy will grow at a rate of 6.5 percent in the financial year. Interest rates are directly related to inflation. Interest rates can be cut if the retail inflation rate falls to 4 percent or below. In the current financial year, the retail inflation rate can be 5.1 percent.
Reserve Bank of India Governor Shaktikanta Das said the central bank is trying to bring down retail inflation below 4 percent, but El Nino could pose a challenge.
In an interview with the news agency PTI, it was said on behalf of Das that the Indian economy can grow at the rate of 6.5 percent in the financial year 2023-24.
It has been said on behalf of Das that we are constantly keeping an eye on the inflation front. In the financial year 2023-24, the average rate of retail inflation could be 5.1 percent. We are continuously trying to bring inflation below 4 percent.
The RBI governor said that interest rates have a direct relation with inflation. RBI can reduce interest rates if the retail inflation rate falls to 4 percent or below. Last year from May 2022, RBI increased the repo rate by 2.50 percent. Due to this, the inflation rate in April last year was 7.8 percent. It has come down to 4.25 percent in May this year. Also said that credit growth could be 16 percent in the current financial year.
Das further said that some challenges regarding inflation still remain. In this, the volatile international situation due to geopolitics and domestically the monsoon will play a big role.
At present, we are assuming that the monsoon will be normal. However, El Nino is a challenge, as the monsoon has a direct impact on food inflation.
