In the rate hike cycle, the US Fed has increased by 25 basis points. The European Bank has increased by 50 basis points even after Credit Suisse sank. At the same time, the British Central Bank has increased the interest rates by 25 basis points.
Rbi Governor Shaktikanta Das
On one hand the global economy is going down. Inflation is at its peak. OPEC Plus has reduced the production of crude oil. Because of this, the price of crude oil can go beyond $100. Recession seems to be hitting the world. At the same time, the most important thing is that the Federal Reserve of America, the Central Bank of America, the European Central Bank and the British Central Bank have increased the interest rates. Even after that, the RBI governor has kept his interest rates flat. Interest rates have not increased. Which is considered to be a very big decision from the point of view of the global economy.
By the way, the RBI governor has made it clear that the decision to stop the rate is for this meeting only. The RBI Governor has given a clear indication that the Monetary Policy Committee will not hesitate to take any step in the future. It is clear that RBI has opened a safe window keeping in view the changing macro economic conditions in the future. Let us also tell you what are those reasons, due to which the RBI governor is being considered as the ‘Pathan’ of the global economy.
Crude oil will increase inflation
As the RBI governor himself said that since the beginning of the year, improvements were being seen in the global supply chain. All the central banks were taking their economy towards soft lending, but after the beginning of the month of March, dramatic changes were seen in the global economy. In this, it is most important to increase the price of crude oil on behalf of OPEC Plus. Because of this, India’s import bill will increase, which will not be good for the economy. Along with this, inflation will also increase. Despite this, RBI has not made any change in the repo rates. By the way, RBI has not made any significant change in its inflation estimate. In the current financial year, the inflation estimate has been kept at 5.3 percent. For this reason, the governor has not increased the repo rate.
Read this also:- RBI Repo Rate Hike: Interest rate hiked for the 7th consecutive time, home and car loan installments increased
Global inflation at its peak
On the other hand, there is no significant reduction in global inflation. Inflation is seen differently in the world’s largest economies. Talking about inflation in 19 different countries of G20, it ranges from 1 percent in China to 102.5 percent in Argentina. On the other hand, inflation in America still remains at 6 percent. Other central banks around the world are facing similar problems. In Britain, the inflation rate came down to 10.4 percent in February, while it was at 10.1 percent in January. Core inflation in the European zone is at a record high of 5.7 per cent. In such a situation, everyone has increased their interest rates, but RBI’s thinking on inflation is clearly visible.
RBI keeps the repo rate unchanged at 6.5% with readiness to act should the situation so warrant, announces RBI Governor Shaktikanta Das pic.twitter.com/8UoBu5P6tx
— ANI (@ANI) April 6, 2023
Read this also:- RBI MPC Meet: Inflation rate will remain above 5%, Governor said – war will continue till it comes under control
Chaos in the global economy
There is chaos in the global economy all over the world. Especially after America and US banking sector crisis, Fed and European Central Bank have increased by 25 and 50 basis points respectively. The RBI governor and the government have made it clear that the impact of the banking sector crisis has not been seen and will not be seen as much, but there has been a lot of decline in the Indian IT sector. By the way, jobs are at risk all over the world. There is a danger of sinking of many banks all over the world, due to which the instability of the global economy is being seen.
Read this also:- RBI MPC Meet: Fear of shadow recession in the world, India’s growth still estimated to be 6.5%
effect of recession in the world
The World Bank has already expressed concern about the global recession. The World Bank has clearly said that there will be a slowdown in the whole world. There will be an increase in inflation. Investment will be less. Ukraine and Russia war effect will be visible. On the other hand, a new episode of geopolitical tension has started between China and America. In such a situation, the possibility of recession in the global economy cannot be denied at all. In such a situation, not increasing the policy rate on the part of the RBI governor can be called a very bold decision.
Source: www.tv9hindi.com
: Language Inputs