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Informist, Friday, Jun. 20, 2025

MUMBAI - Following are the highlights of the minutes of the Jun. 4-6 meeting of the Reserve Bank of India's Monetary Policy Committee, released by the central bank on Friday:

SANJAY MALHOTRA

* Global economic situation remains fragile, fluid

* Medium-term view overcast on recurrent geopolitical tensions

* Medium-term view overcast on reshaping new global trade order

* Global growth on weak footing, inflation receding but slowly

* See above-normal monsoon providing impetus to rural demand

* Falling CPI, services sector momentum to revive urban demand

* High global uncertainties call for growth supportive policies

* High global uncertainty may put private investment decisions on hold

* Food prices seen moderate during year on above-normal monsoon

* Core inflation may remain largely contained

* Growth remains steady but lower than aspirations

* Monetary policy needs to aid growth in current conditions

* Front-loaded rate action to support consumption, investment

* Growth-CPI view contingent on monsoon pattern, goods prices

* Post 100 bps total rate cuts, limited space left to aid growth

* Neutral stance gives flexibility to cut, pause, or hike rate

NAGESH KUMAR

* India likely to face onslaught of dumping of cheap Chinese goods

* Economic recovery in Jan-Mar has not been broad-based

* Not sure if Jan-Mar growth momentum will continue in Apr-Jun

* Investment intentions in manufacturing have moderated in FY26

* Global uncertainty, its impact on manufacturing calls for supporting growth

* Global uncertainty calls for fiscal, monetary support for growth

* Hefty RBI transfer gives government room for potential fiscal stimulus

* Lower crude oil price, good monsoon, soft dollar show CPI sub-4% FY26

* Transmission of monetary easing to deposit, loan rates was slow

* Case for 50-bps rate cut stronger in June than in April

* Double dose of rate cut likely to bring down loan rates sharply

* 50-bps rate cut to send clear message of aiding growth momentum

* 50 bps rate cut likely to spur investment, durable goods consumption

SAUGATA BHATTACHARYA

* Uncertainty key behind caution in pacing policy easing

* Current growth impulses exhibit economic resilience

* Revision in FY24 GDP data supports calibrated policy easing

* Await effects of income tax cuts, other support measures

* Near-, longer-term CPI forecasts offer more easing space

* Rate cut transmission to bank loan rates picked up post March

* Rate cut transmission to bank loan rates seen moving apace

* Liquidity steps to impact transmission more than repo cut

* Measured, cautious progress in easing more apt right now

RAM SINGH

* Strong case for rate cut to aid growth on benign inflation view

* GDP growth rate remains below the aspirational levels of 7-8%

* Neutral rate likely headed toward pre-COVID levels

* Scope of 75 bps cut sans growth hit if average neutral rate of 1.65%

* Assumptions about global growth, inflation changing daily

* Caution needed in rate cut on high growth, food CPI uncertainty

* Need to ascertain likelihood, timeline of rate cut pass-through

* Current situation warrants frontloaded rate cut

* Several indicators point to demand deficit

* Demand for mid-size housing, urban consumption remains subdued

* Private investment remains tepid despite massive govt capex

* Despite rate cuts in Feb, Apr, credit growth has not picked up

* Demand for loanable funds is lower than usual

* Realisation of 7-8% GDP growth will need higher credit growth

* Staggered rate cut can delay demand, investment materialisation

* 50 bps rate cut may give needed push to borrowers, lenders alike

* 50 bps rate cut should not cause any overheating in economy

* Don't see early monsoon impacting vegetable prices in near-term

* Pressure on rupee to be short-lived on robust economic fundamentals

* Support change in stance on unquantifiable global uncertainties

POONAM GUPTA

* India's economic growth can be higher based on favourable demography

* Core inflation would be lower excluding high, rising gold prices

* Inflation expectations are on a moderating trend

* CPI to undershoot 4% aim at margin; gives space to support growth

* Monetary policy has need, room to provide support to economy

* Monetary policy has room to help growth surpass past levels

* There was a case for 2 consecutive rate cuts of 25 bps each

* There is also merit in front-loading these cuts

* Frontloaded rate cut should help in fostering policy certainty

* Frontloaded rate cut to transmit faster than staggered cuts

* Frontloaded rate cut to better counter global econ challenges

* Further rate actions contingent on data, global uncertainties

RAJIV RANJAN

* Data points to more than expected softening of inflation

* Baseline outlook for FY26 inflation largely comfortable

* Core CPI trends show underlying inflation pressures contained

* Growth could be higher given the trend in recent years

* Frontloading rate cut can help fasten transmission

* 50-bps rate cut apt from perspective of signaling, certainty

* Risk that 50 bps cut, accommodative stance could mislead markets

* 50 bps cut, accommodative stance can mislead on further easing

* Neutral stance shouldn't be seen as change in policy direction

* Neutral stance provides flexibility

* Policy setting in current uncertainties not cast in stone

* To respond aptly via policy steps if outlook changes materially

* Need to focus more to facilitate policy transmission near term

End

Compiled by Akash Tirlotkar

Filed by Ashish Shirke

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