As I make this statement, the pandemic holds the global economy hostage
once again. Despite signs of moderation, record numbers of daily infections in
several countries and consequent containment measures are denting thepace ofeconomic activity, especially in contact-intensive sectors, even as supply disruptions persist and restrained workforce participation tightens thelabour markets. With inflation at multi-decadal highs in a number of countries, the evolving macroeconomic environment is being rendered highly uncertain by divergent monetary policy intentions and actions. Financial market volatility and geo-political tensions are adding layers of ambivalence to the outlook.

Notwithstanding a highly transmissible third wave driven by the Omicron
variant of COVID-19, India is charting a different course of recovery from the rest of the world. India is poised to grow at the fastest pace year-on-year among major
economies, according to projections made by the International Monetary Fund (IMF).
This recovery is supported by large-scale vaccination and sustained fiscal and
monetary support. Once again, our frontline warriors have admirably risen to the call of duty.

As we gain valuable experience from repeated waves of the pandemic, our
responses are also becoming nuanced and calibrated. Protecting life is paramount;
and protecting livelihood is rising in the hierarchy of priorities. The focus is on
securing the economic and financial conditions of the vulnerable, the wage earners and all those who suffer the most. Accordingly, the emphasis is shifting to targeted containment strategies and a push towards universal vaccination and booster doses. This approach is being complemented by increased adoption of technology in our workplaces and in our day-to-day lives. The effort is to limit the extent of disruptions

Deliberations of the Monetary Policy Committee

  1. The Monetary Policy Committee (MPC) met on 8th, 9th and 10th February 2022
    and based on an assessment of the current macroeconomic situation and the outlook, it voted unanimously to keep the policy repo rate unchanged at 4 per cent. The MPC decided by a majority of 5 to 1 to continue with the accommodative stance as long as necessary to revive and sustain growth on a durable basis and continue to
    mitigate the impact of COVID-19 on the economy, while ensuring that inflation
    remains within the target going forward. The marginal standing facility (MSF) rate and the Bank Rate remain unchanged at 4.25 per cent. The reverse repo rate also remains unchanged at 3.35 per cent