RBI Keeps Interest Rates Unchanged, Says Worst Over For Economy

By Shakir Husain NEW DELHI, Oct 9 (Bernama) -- India's central bank on Friday said the worst is over for the country's COVID-19-hit economy and kept key interest rates unchanged. Real gross domestic product (GDP) is expected to decline by 9.5 per cent for the financial year 2020-2021 as a whole, Reserve Bank of India (RBI) governor Shaktikanta Das said. The RBI's Monetary Policy Committee decided to keep the interest repo rate unchanged at four per cent and the reverse interest repo rate at 3.35 per cent after an assessment of "the current and evolving macroeconomic situation." The central bank chief said there were "impulses of growth" in various sectors of the economy after sharp declines in the first quarter (Q1) of April-June. GDP in Q1 slumped 23.9 per cent, according to official data earlier, as the nation of 1.38 billion people went into lockdown to contain the COVID-19 pandemic, leading to millions of job losses and business disruptions. "Barring the incidence of a second wave, India stands poised to shrug off the deathly grip of the virus and renew its tryst with its pre-COVID growth trajectory," Das said in a statement. He said the country's mood has shifted from "fear and despair to confidence and hope" amid a revival of economic activity. "Migrant labour is returning to work in urban areas, and factory and construction activities are coming back to life. This is also reflected in rising levels of energy consumption and population mobility," Das added. -- BERNAMA