RBI Makes No Projection On GDP Or Inflation Amid COVID-19 Uncertainty

Shaktikanta Das, RBI Governor, on Friday said that no projection in respect of either GDP or inflation is being put forth given the uncertain outlook on account of the Covid 19 pandemic. In a usual case, in its monetary policy, RBI gives projections for both GDP and inflation.

"The implied real GDP growth of 4.7 percent for Q4:2019-20 in the second advance estimates of the National Statistics Office, released in February 2020, within the annual estimate of 5 per cent for the year as a whole is now at risk from the pandemic's impact on the economy. As regards the outlook for 2020-21, apart from the continuing resilience of agriculture and allied activities, most other sectors of the economy will be adversely impacted by the pandemic, depending upon, I repeat, its intensity, spread and duration," the RBI Governor said in a video press briefing.

While announcing the MPC decision, Das said performance of these two macroeconomic metrics in the coming days would largely be based on the intensity, spread as well as duration of Covid 19.

And on global slowdown, Das said it could deepen further and India too would not remain immune to it, though falling crude prices will lend their help. Also, food prices may ease given record crop production.

Further, the governor said the country's GDP forecast of 4.4% for FY20 is at risk and the FY21 outlook remains unclear amid coronavirus pandemic.

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