“Tracking the market expectation of the status quo, the monetary policy statement is an affirmation of goldilocks for India with high growth and low inflation in FY25 and FY26. Consumers’ confidence in urban households continues to improve, while Rural Demand remains upbeat. The regulatory policy as usual has continued the deepening of payment systems with new functionality in UPI. The review of the LCR framework with the advent of 24/7 payment systems could act as a positive enabler to address frictional liquidity mismatches. The trading of sovereign green bonds in IFSC is also a welcome move and will broaden the markets.”
