Finance secretary Tuhin Kant Pandey said on Tuesday that the government has presented a budget to reduce the fiscal deficit, which will not increase inflation. Now the Monetary Policy Committee of the Reserve Bank of India (RBI) has to decide on the interest rate cut to promote growth. Pandey said, fiscal policy and monetary policy need to work together, not for adverse purposes because if we are able to control inflation, then there will be a lot of benefit from monetary ease. ā€¯Fiscal in the budget The loss is estimated to be 4.4 percent in the financial year 2025-26, which is less than 4.8 percent in the current financial year 2024-25.
Announcement of monetary policy on Friday
Pandey said in a discussion organized after the budget with the Indian Commerce and Industry Board (Assocham) here, it is very important to clarify what we have to do within a certain fiscal system. We have to help monetary authorities to that extent. The three -day meeting of the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) will start from February 5. The MPC will announce its policy decisions on February 7. Asked about the increased concern over inflation due to the fall in the rupee, the secretary said that the decline affects the inflation on imports, but it also increases export competitiveness. Asked if the monetary policy committee will decide to cut the policy rates, Pandey said, I think this decision will be taken by MPC. They are aware of the situation. They will take a decision.
New governor Sanjay Malhotra will preside
The newly appointed Governor of the Reserve Bank Sanjay Malhotra will preside over the meeting of the Monetary Policy Committee (MPC) starting on Wednesday. The decision of the six -member committee will be announced on Friday 7 February. Madan Sabnavis, the chief economist of Bank of Baroda, said, this time there is a possibility of cutting policy rate. There are two reasons for this. First, RBI has already announced measures to increase cash. This has improved the market situation. It clears the way forward to cut policy rates. Sabanvis said that encouragement has been given through the Union Budget and it seems appropriate to reduce the repo rate to support it. The Reserve Bank has announced measures to pour cash worth Rs 1.5 lakh crore to banks on 27 January.
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