Given the tradeoffs between growth forecast trimmed down to 7.2%, inflation expected at 6.3% this quarter and pressure on the current account in balance of payments, the best and possibly the only option available to the RBI was to maintain status quo by keeping the repo rate at 4%. Any change in monetary policy would only have added to the volatility and uncertainty facing economies across the world.
-Dr. Sashi Sivramkrishna, Sr. Adjunct Professor of Economics at NMIMS, Bangalore
