Following the November 8th announcement to demonetize 500 and 1000 rupee notes, many had expected RBI to slash the monetary policy but the announcement shocked many.

  • Repo rate and Reverse Repo rate remained unchanged at 6.25 percent & 5.75 percent respectively.  
  • Cash reserve ratio or CRR unchanged at 4 percent
  • Growth forecast was cut to 7.1 percent, from 7.6 percent for this fiscal
  • Inflation target remained at 5 percent for March 2017
  • All MPC members voted in favour of status quo in policy
  • Demonetisation to result in short-run disruptions in cash-intensive sectors
  • Crude price volatility, surge in financial market turbulence could put March end inflation target at risk
  • Foreign exchange reserve rose to all-time high of USD 364 billion on 2 December.
  • RBI injected Rs 1.1 lakh crore liquidity through OMO purchases this fiscal
  • Next monetary policy to be announces on 8 February.


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