Instead of decreasing the havoc of inflation in the country, it is increasing. After the retail inflation reaching above seven per cent in April, once again the fears of an increase in the repo rate from the Reserve Bank have increased. If this happens, then the monthly installment (EMI) of your loan may increase further. Earlier this month, the Monetary Policy Committee, headed by Reserve Bank Governor Shaktikanta Das, met unexpectedly and decided to increase the repo rate by 0.40 per cent.
Apart from this, the reverse repo was also increased by 0.50 percent. Industry and experts were all surprised by this decision of the Reserve Bank. After this, many big banks of the country including HDFC, SBI, ICICI increased the loan rates by up to 0.40 percent. Is. If this happens, your EMI may increase further.
RBI alone cannot fight inflation
Experts say that the rate hike by the Reserve Bank was not as surprising as the sudden and direct increase of 0.40 per cent. The industry was anticipating that the Reserve Bank would increase rates gradually, but the RBI eventually increased the repo, citing high inflation. Prior to this, the RBI governor had said many times that the Reserve Bank alone cannot fight inflation and for this, the central as well as the state governments will have to take strict steps on the supply front. For this oil prices will have to be controlled.
RBI may increase rates further
In a Bloomberg report, experts have been quoted as saying that with inflation being higher than expected, the problems are going to increase. It said that there is a possibility of further tightening of monetary policy. It has been estimated that the RBI may increase the repo rate to 5.4 in the four quarters of the current financial year. At the same time, analysts expect this rate to increase to 5.75 by December 2023, which is 0.50 per cent higher than the earlier estimate.
WTO should play a special role: India
India has asked the World Trade Organization (WTO) to play its role amid rising global inflation. Ambassador and Permanent Representative to WTO Brajendra Navneet made this request in a statement made on behalf of India.
He said the global trade body’s top priority should be to revive economies and sustain economic growth in the aftermath of the COVID-19 pandemic and during the geopolitical crisis. The current situation has created another major problem, which is rising inflation in the economies of most countries, the Permanent Representative said. The statement was made during an informal meeting of the Trade Negotiating Committee (TNC) and the Head of Delegations (HOD) on May 4.