The Big Picture - Monetary Policy & Economic challenges

The Monetary Policy Committee of the Reserve Bank of India on Thursday effected a 25 basis points cut in repo rate in its second bimonthly policy review of this financial year. After the cut, the repo rate now stands at 5.75 per cent. The MPC also changed policy stance to 'accommodative' from 'neutral'. This was third rate cut in a row by the central bank. Repo is the rate at which the central bank lends to commercial lenders. The committee also revised its GDP growth for FY20 downward to 7 per cent from 7.2 per cent in the April policy. It sees growth in the range of 6.4-6.7 per cent in the first half of the financial year and 7.2-7.5 per cent in the second half, with risks evenly balanced. Apart from this, the Reserve Bank of India did away with charges on fund transfers through RTGS and NEFT routes to boost digital transactions and asked banks to pass on the benefits to customers. Meanwhile, Prime Minister Narendra Modi will head two separate Cabinet committees on ‘investment & growth’ and ‘employment & skill development’, underscoring the urgency in the new government to revive the slowing economy and generate more jobs. On this edition of the big picture we will analyse the decisions taken by the authorities to address economic challenges

Anchor: Frank Rausan Pereira

Guest:
Ajay Dua, Former Secretary, Ministry of Commerce & Industry
Ashok Nag, Former Advisor, RBI
A. K. Bhattacharya, Editorial Director, Business Standard
Banuchandar Nagarajan, Former Consultant, World Bank, Washington DC