RBI board reviews the economic situation, approves giving dividend of Rs 30,307 crore to the central government

RBI: The RBI board has decided to transfer a surplus amount of Rs 30,307 crore to the central government for 2021-22.

Under the chairmanship of RBI Governor Shaktikanta Das, the Central Board of Directors of RBI met in Mumbai. In the meeting, the current economic situation, from global domestic challenges to the impact of geopolitical influences were discussed. In the meeting of the RBI board, from April 2021 to March 2022, the functioning of the RBI was discussed. In the meeting, the RBI board has decided to transfer a surplus amount of Rs 30,307 crore to the central government for 2021-22. At the same time, RBI has decided to maintain the Contingency Risk Buffer at 5.50%. The amount given by the RBI board to the central government as surplus i.e. dividend for 2021-22 is less than the government’s estimate. The government had set a target of getting dividend of Rs 73,948 crore.

Rising inflation raised concern

 However, after the data of retail inflation and wholesale price based inflation reached the highest level of 9 years, there is a difficult time for the RBI. On one hand it has the challenge of reducing inflation through monetary policy and on the other hand it has the responsibility of accelerating economic growth. On that the dollar rupee is depreciating continuously, which has increased the trouble of RBI. On Thursday, the dollar has fallen to 77.73 against the rupee. In the meeting of the Monetary Policy Committee in June, the RBI may again announce an increase in the repo rate. According to experts, in the month of June, the RBI can announce a 25 to 35 percent increase in the repo rate in its Monetary Policy Committee (MPC) meeting. The repo rate can be increased from the current level of 4.40 percent to 4.75 percent. If this happens, then your EMI can become more expensive.

RBI’s MPC meeting will be held from 6 to 8 June
RBI’s Monetary Policy meeting will start for 3 days from June 6, 2022. And on June 8, the decision taken in the monetary policy will be announced. Earlier, after RBI’s policy meeting on May 4, suddenly the repo rate was increased by 40 basis points to 4.40 percent and the cash reserve ratio was increased by 50 basis points from 4 percent to 4.50 percent. However, the increase in CRR is going to be implemented from May 21. After which the cash present in the banks system will decrease.

Debt became costlier after repo rate hike
RBI announced a 40 basis point increase in the repo rate on May 4, since then, from public-private banks to housing finance companies, from home loans to other types of loans are becoming costlier. So the EMI of the customers who have already taken loan is getting expensive. And the process of EMI becoming expensive is not going to stop here. After the meeting of the Monetary Policy Committee in June, the borrowers may again get a setback.