[ad_1]
MUMBAI, April 13 (Reuters) – India's central bank will remain vigilant and strive to boost the growth of Asia's third-largest economy, as well as maintain macroeconomic, financial and price stability, its governor said on Friday. speech.
India lost momentum in the last quarter of 2018, bringing its annual economic growth rate to 6.6%, its slowest pace in five quarters and far less than expected.
But the governor of the Reserve Bank of India (RBI), Shaktikanta Das, said the country's real gross domestic product (GDP) growth is expected to reach 7.2 percent for the period to March 2020, which he described as the strongest of the world's major economies.
The annual retail inflation rate in India reached 2.86% in March, against 2.57% the previous month, but remained below the central bank's target for an eighth consecutive month, increasing chances of a reduction in the key rate in June.
"Inflation has remained below target, averaging 3.6% for the period covered by the inflation targeting framework," said Das in his speech, uploaded to the RBI's website on Saturday. morning. He said that he was referring to the period from October 2016 to February 2019.
The RBI lowered its retail inflation forecast to 3.8% in January-March 2020, but warned that it could be higher if food and fuel prices went up sharply or if budget deficits were exceeded.
India's current account deficit is expected to be around 2.5 percent of GDP in 2018-2019 and the gross budget deficit is in line with fiscal targets, he added.
Das pointed to the risks facing emerging market economies such as India, as global growth and trade falter.
"There is a great deal of uncertainty as to whether this weakness is temporary or at the beginning of a recession in advanced economies," said Das, adding that central banks around the world would not tighten the tightening of monetary policy some advocating even easier credit conditions.
The RBI lowered its key rate by 25 basis points earlier this month, largely inspired by the idea of reviving the economy at a time when Prime Minister Narendra Modi is seeking a second term in office. a national election.
Emerging market economies also remain exposed to volatile financial markets, Das added, and financial conditions could exacerbate existing tensions on the balance sheets of credit institutions in some countries. (Report by Sankalp Phartiyal, edited by Joseph Radford)
Source link
