The Reserve Bank of India made the decision to reinstate market hours from 9 am to 5 pm for the call/notice/term money, commercial paper, certificates of deposit, and repo in corporate bond segments of the money market. They also reinstated market hours for rupee interest rate derivatives. This was done in an effort to return to normal liquidity operations.

The deadline for the HTM categorization of new bank investments in bonds has been extended until March 2024, which paves the way for the stability of the bond market and the financial industry as well as future government borrowing. The Reserve Bank of India recently altered its monetary policy in a pragmatic manner, taking into account the instability that has been seen both domestically and internationally.

As was largely predicted, the key repo rate that is administered by the Reserve Bank of India was increased by 35 basis points (bps). This marks the sixth increase in a row, and the Federal Reserve has vowed to keep up the fight against high inflation.

The monetary policy committee (MPC), which is comprised of three RBI officials and three external members, has decided to raise the key lending rate, also known as the repo rate, to 6.25 percent. This decision was reached through a majority vote. The price increase was approved by five of the six members who cast votes.

According to the Governor of the Reserve Bank of India (RBI), Shaktikanta Das, the fundamental concern is that inflation will continue to be high and persistent.

The Monetary Policy Committee was of the opinion that a more nuanced approach to monetary policy action was required in order to anchor inflation expectations, breakcore inflation persistence, and manage second-round consequences. The focus will continue to be on containing inflation. The efforts that are being made in order to bring inflation down to more normal levels won't be scaled back at any point, said Das.

The MPC lowered its prediction for GDP growth for the fiscal year 2022/23 from 7% to 6.8%, while maintaining its forecast for retail inflation at 6.6%.

The economy of India continues to be robust when seen in the context of the global economy. A growth rate of 6.8 percent is considered healthy. The Reserve Bank of India (RBI) has decided to stop its accommodative monetary policy and instead focus on inflation targeting. This decision will be beneficial to the economy over the long term. The development of retail and corporate margins, as well as the expansion of credit, should continue to benefit the banking industry. The increase in rates is roughly in line with what was anticipated.