In his 110 minute long address to the Parliament, one quote made by Indian Finance Minister Arun Jaitley on February 1st, during the Union Budget session made international headlines. A quote powerful enough to send markets tumbling.
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.
Indian Finance Ministry has increased the cash withdrawal limit from INR 2000 to INR 2500.
Daily exchange limits have been increased to INR 4,500 from the previous limit of INR 4,000.