Patra, as executive director of the central bank, was the principal advisor to the Monetary Policy Department since July 2012.
With inflation comfortably below the Reserve Bank of India's (RBI's) 4 per cent median target and likely to undershoot its 3.7 per cent projection for 2025-26 (FY26), there is room for the monetary policy easing cycle to be sustained, the Finance Ministry said on Monday. The comments, featured in the ministry's Monthly Economic Review for June 2025, assume significance ahead of the Monetary Policy Committee (MPC) meeting of the Reserve Bank of India (RBI) scheduled to begin from August 5.
While the RBI, in the recent past, appeared keen to move to an inflation-targeting framework, industry and academia remain divided on this issue.
The Indian government has extended the Reserve Bank of India's (RBI) mandate to maintain retail inflation at 4 per cent, with a tolerance band of 2 per cent on either side, for another five years until March 2031.
The government on Tuesday appointed three external members -- Ram Singh, Saugata Bhattacharya and Nagesh Kumar -- to the RBI's rate-setting Monetary Policy Committee for four years. The central government has reconstituted the Monetary Policy Committee (MPC) of RBI, the finance ministry said in a statement. Ram Singh is the director of the Delhi School of Economics, Saugata Bhattacharya is an economist, and Nagesh Kumar is the director and Chief Executive, Institute for Studies in Industrial Development, New Delhi.
The Reserve Bank of India (RBI) is expected to cut interest rates for the first time in nearly five years in Governor Sanjay Malhotra's first monetary policy committee (MPC) meeting on Wednesday. The meeting of the six-member MPC, which will culminate on Friday, aims to boost sluggish economic growth, which is seen falling to a four-year low. Malhotra took charge as the 26th RBI governor in December last year.
Reserve Bank Governor Shaktikanta Das on Tuesday said the fiscal-monetary coordination was at its best during the last six years even as he thanked Prime Minister Narendra Modi for giving the opportunity to head the monetary authority of the country. Das, in a series of posts on X, on his last day of his six-year term as RBI Governor, also thanked the Finance Minister, various stakeholders and his colleagues at the central bank.
The Reserve Bank is unlikely to cut the benchmark interest rate in its forthcoming bi-monthly monetary policy review later in the week as retail inflation is still a cause of concern, and there is a possibility of the Middle East crisis deteriorating further, impacting crude oil and commodity prices, say experts.
Shaktikanta Das will demit the office on Tuesday after completing six years as the 25th Governor of the Reserve Bank of India. Revenue Secretary Sanjay Malhotra will replace him as the 26th Governor. He was appointed as the Governor on December 12, 2018, after the abrupt exit of Urjit Patel.
The government has invited applications for the post of deputy governor of the Reserve Bank of India (RBI) from interested candidates with at least 25 years of experience and below 60 years of age as on January 15, 2025. One of the deputy governors, Michael Patra's current term will end on 15 January. The last date of submission of applications is November 30, 2024.
Perhaps because the Modi government had some differences of opinion with two of the economist governors (one of whom was appointed by the Manmohan Singh government), there is a view that its political leadership prefers a civil servant to head the RBI, notes A K Bhattacharya.
'I think today RBI supervision is much sharper than what it was earlier.'
A day after his appointment as the 26th governor of the Reserve Bank of India (RBI), outgoing Revenue Secretary Sanjay Malhotra on Tuesday said one must understand the economic landscape and do what was best for the economy. "Let me first go, join, understand the turf ... Here it is a different role," Malhotra said, speaking to reporters in front of North Block.
'Once bitten, twice shy, I didn't take up the challenge this time...' 'I realised I had failed to follow my karma because I feared failure.'
Select bankers will meet RBI Deputy Governor Subir Gokarn, who is in-charge of the monetary policy department, and other central bank officials on July 12.
The Reserve Bank of India on Friday revised upwards the GDP growth projection for the current fiscal to 7.2 per cent from 7 per cent on rising private consumption and revival of demand in rural areas. Unveiling the bi-monthly monetary policy, RBI Governor Shaktikanta Das said estimates released by the National Statistical Office (NSO) placed India's real gross domestic product (GDP) growth at 8.2 per cent in 2023-24. "During 2024-25 so far, domestic economic activity has maintained resilience," he said, adding that manufacturing activity continues to gain ground on the back of strengthening domestic demand.
India's economic growth is estimated to have slowed down to 11-year low of 5 per cent during the current financial year ending March 2020.
Acharya was one of the youngest deputy governors in the central bank's history and was in charge of the critical monetary policy department which also made him a part of the rate-setting panel.
Wholesale price based inflation declined to a 3-month low of 1.89 per cent in November on cheaper food items, and experts predicted a 0.25 per cent interest rate cut by the RBI in the policy review in February. The Wholesale Price Index (WPI) based inflation was 2.36 per cent in October 2024. It was 0.39 per cent in November, last year. In August, 2024, it was 1.25 per cent.
The Reserve Bank of India has also expressed concern over rising inflation and said the prevailing level is above its comfort zone.
Wholesale inflation fell to a 3-month low of 2.04 per cent in July on decline in prices of food items especially vegetables, government data released on Wednesday showed. The decline in wholesale price index (WPI) based inflation in July came after it rose for four months in a row till June, when it was 3.36 per cent. It was (-) 1.23 per cent in July last year. In April wholesale inflation stood at 1.19 per cent.
Deputy governors Subir Gokarn, Usha Thorat and Shyamala Gopinath will get additional portfolios, which were until now under K C Chakrabarty, RBI said in a statement today. The central bank did not give any reason for the reshuffle and said the changes will be effective tomorrow.
Here is some background on the candidates seen as potential successors to Rajan at the RBI
Industry is demanding a cut in repo rate to help revive India's sagging GDP growth that hit decade's low of 4.5 per cent in the third quarter of 2012-13.
As per the RBI Act, the central bank should have four deputy governors - two from within the ranks and one commercial banker and the fourth one an economist to head the monetary policy department.
The government on Wednesday appointed RBI's senior-most executive director M Rajeshwar Rao as the deputy governor of the central bank. Rao was appointed to the post vacated by N S Vishwanathan, who stepped down three months ahead of his extended tenure on health grounds.
Relations between the Mint Road and North Block have often been frosty, with the former's calls for lowering rates being the biggest point of difference
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Many countries, including Japan, are having deflation and they are trying to go back to an era of inflation.
Given the pressure from India Inc and the banking fraternity, it is surmised that the portfolio rejig will take place before April.
'A possible post-election growth momentum may be lost.'
This is the second high profile resignation in the past six months at the Reserve Bank of India.
A combination of factors, including heavy investments in US Treasury bonds and dollar sales at a healthy profit, facilitated the Indian central bank in transferring a record surplus of Rs 2.11 trillion to the government for 2023-24 (FY24). The RBI's dollar purchases increased in FY24, supported by robust capital inflows endorsing the economy's health.
The RBI's rate-setting panel MPC on Monday began its three-day deliberation amid expectations of another round of hike in benchmark interest rates to contain inflation that continues to remain above the central bank's upper tolerance level. RBI Governor Shaktikanta Das will announce the decision of the Monetary Policy Committee after deliberations on Wednesday. Das has already indicated that there may another hike in the repo rate, though he refrained from quantifying it.
Along with Subir Gokarn's appointment as the fourth deputy governor, the Reserve Bank of India on Wednesday reshuffled some of the key portfolios of its deputy governors and executive directors.
As deputy governor, Patel headed the RBI panel to draft the monetary policy report, which became the basis of the ongoing reforms at the apex bank
The economic growth is likely to moderate to 6.1 per cent, slowest in over seven quarters, from 6.6 per cent last year same period.
The Monetary policy committe comprising 6 members voted 6-0 in the favour of the rate cut.
He will be the eighth Deputy Governor to be made Governor at RBI
The finance ministry has received about 100 applications for the post, which have been sent to the high-level panel that will select a suitable candidate for the post, sources said.
Gokarn was the first Indian central banker who regularised warnings to the government, through the monetary policy statement, on the need to reduce fiscal deficit.
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