New Delhi. Prior to the beginning of the budget session of Parliament, PM Narendra Modi said that he prays that the grace of Goddess Lakshmi, the goddess of wealth, should remain on the poor and middle class. When Finance Minister Nirmala Sitharaman presented the budget in the Lok Sabha on Saturday, she announced all convenience to the poor and middle class. Nirmala Sitharaman made the income tax free to the annual income of up to 12 lakhs. At the same time, the elderly also dropped the income of up to 1 lakh annually on savings from TDS. For youth, this limit was also announced in the budget to increase from Rs 40000 to Rs 50000. Now everyone’s eyes are on 7 February.
Actually, the meeting of the monetary committee of the Reserve Bank i.e. MPC is going to be held from 5 to 7 February. On 7 February, Reserve Bank Governor Sanjay Malhotra will take information about the decisions taken in the MPC meeting. If they announce to reduce the repo rate, then the middle class people taking loans will get further relief. In fact, Shaktikanta Das and other members of the MPC, who were the Governor of the Reserve Bank and other members of the MPC, had long kept the repo rate at 6.50 per cent for a long time. This was also increasing EMI on the loan. If the repo rate announces to reduce the RESIV Bank Governor Sanjay Malhotra, then EMI is also expected to be reduced on the loan.
If EMI is reduced due to reducing repo rate, then more money will come in the hands of the middle class. They will be able to invest or spend it. Which will strengthen the economy. However, there may be a disadvantage of reducing repo rate that inflation can jump again. The rate of inflation in December was more than 5 percent. Whereas, the Finance Ministry and the Reserve Bank have decided to keep the rate of inflation up to 4 per cent. Now the eyes of people taking loans and paying EMI are definitely going to be on the decision of the Reserve Bank’s MPC meeting.
