The Monetary Policy Committee (MPC) has cut its real GDP projection for FY22 to 9.5 per cent from it previous projection of 10.5 per cent.
This comes in the backdrop of Covid-19 pandemic spreading to smaller towns and rural areas and urban demand getting dented.
The projection of real GDP growth for 2021-22 consists of 18.5 per cent (earlier projection: 26.2 per cent) in Q1; 7.9 per cent (8.3 per cent) in Q2; 7.2 per cent (5.4 per cent) in Q3; and 6.6 per cent (6.2 per cent) in Q4.
Also read: RBI keeps rates unchanged to support growth
High international commodity prices and logistics costs prompted RBI to up its projection for Consumer Price Index (CPI) inflation for the second, third and fourth quarter of FY22 while retaining its Q1 projection
The projection for Q1:2021-22 has been retained at 5.2 per cent. The new projections for the remaining quarters are 5.4 per cent for Q2 (earlier projection: 5.2 per cent); 4.7 per cent for Q3 (4.4 per cent); and 5.3 per cent for Q4 (5.1 per cent), with risks broadly balanced.