RBI Released Interest Rate Decision

RBI Released Interest Rate Decision
Today during Asian hours, Reserve Bank of India (RBI) has released interest rate decision and monetary policy statement. RBI kept interest rate unchanged at 4.00 pct (expected 3.75). In addition, RBI keeps CRR unchanged at 3.00 pct and reverse repo rate at 3.35 pct.
Highlights of the Monetary Policy statement:

  • Global financial markets have been optimistic.
  • Inflation will remain high
  • Agriculture sector prospects have improved with the good monsoons and rise in Kharif sowing area
  • The merchandise exports contracted for fourth consecutive month though the pace of contraction has moderated
  • Real GDP growth will remain in the negative
  • An amount of Rs 10,000 Cr of additional liquidity will be provided to NABARD and National Housing Bank. This will help NBFCs and housing sector tide over the liquidity crisis.
  • Loan to value for loans to 90% will be provided for the Jewellery Sector
  • An incentivisation scheme will be launched for banks
  • RBI shall remain alert and watchful and collectively do whatever is necessary to revive the economy and preserve financial stability. Courage and conviction will conquer COVID-19
  • RBI announced introduction of an online dispute resolution (ODR) mechanism for digital payments
  • A scheme of retail payments in offline mode using cards and mobile devices, and a system of on online dispute resolution (ODR) mechanism for digital payments will also be introduced

Technical View:

USD/INR: The Indian rupee remains slightly volatile after RBI’s interest rate decision. The pair made intraday high at 74.80 and low at 74.61. A sustained close below 74.72 marks will drag the parity down towards 74.37, 74.00, 73.76, 73.50, 73.42 and 73.26 mark respectively. On the top side key resistances are seen at 74.90, 75.12, 75.39, 75.52, 75.65, 76.24, 76.48 and 76.88 marks respectively.

Take a look and do trade wisely!
Good Luck