RBI Governor says MPC will review growth and inflation amid oil price surge

Reserve Bank of India Governor Sanjay Malhour told one outlet-TV18 that the Monetary Policy Committee will revisit the interplay between growth and inflation at its upcoming meeting in early October, as crude oil prices climb amid the West Asia crisis. He explained that the impact on inflation will hinge on how much of the oil price increase is passed through to consumers. The interview also covered the robust inflow of foreign currency non-resident (FCNR-B) deposits, which reached roughly $127.22 billion, with nearly half of the portfolio in five-year tenors.

Malhotra said these inflows reflect global confidence in India’s macro fundamentals and have bolstered liquidity and market sentiment. He added that the RBI possesses sufficient tools to manage one outlet excess liquidity in the banking system and will act as needed.