Economy to maintain recovery pace
Finance ministry expects inflation reading to remain between 8-9.5% in April
The finance ministry said that recent rising trends in international commodity prices and domestic energy prices may have temporary second-round effect on inflation in short run. PHOTO: FILE
ISLAMABAD:
The Ministry of Finance on Tuesday claimed that the economy would maintain its recovery pace despite the third wave of Covid-19 and it tamed inflationary expectations by forecasting 8-9.5% inflation reading for April.
“With timely measures taken by the government to tackle the third wave of the pandemic, risks are mitigated, thus better prospects of economic growth are visible,” said the ministry in its monthly Economic Outlook bulletin.
Updated Apr 08, 2021 | 13:22 IST
The decision to keep the repo rate unchanged at 4 per cent in the first meet of the financial year was the fifth time the MPC has done so since May. Representational image. | Photo Credit: PTI
Key Highlights
While retaining its growth outlook for FY22 at 10.5 per cent, the MPC did, however, acknowledge the increasing uncertainty stemming from the resurgence of the SARS-CoV-2 virus across the country
In a show of some optimism, the RBI retained in GDP growth forecast of 10.5 per cent for 2021-22 noting that the country was now better prepared to deal with the COVID-19 outbreak amid the government s continuing immunisation drive
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MUMBAI: In a reflection of the uncertainty that surrounds policy making these days, economists now believe that the best course of action for the Reserve Bank of India’s rate-setting panel on Wednesday will be to reiterate its commitment to keeping monetary policy accommodative in the wake of a raging second wave of Covid-19 infections in the country.
Post the Monetary Policy Committee’s February meeting, the debate among economists was whether or not it’s time for the central bank to start guiding the market about its intention to eventually roll back the extraordinarily loose policy steps taken in the middle of the pandemic in 2020.
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