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ASSOCHAM & EGROW 26th SMPC on Feb 3, 2023

Key Takeaways
  1. India is in a relative "bright spot" in the world economy,
  2. The WPI and CPI both have come down to be in the tolerance range of the RBI.
  3. There is no macroeconomic narrative that established a causal relation between monetary tightening and inflation decline.
  4. The Rupee is coming under pressure again as rising commodity prices pressure the current account deficit (CAD), and the rotation of funds away from India creates funding pressures for India.
  5. The China reopening could challenge production in India.
  6. In the current EBLR regime, hikes by the RBI are being passed on by the banks to customers almost immediately, causing additional pressure on home buyers and industry, especially MSMEs.
  7. Liquidity in the banking system has tightened materially during FY23 and thus it should be eased in 2023-24.
Recommendation and Detailed Views of EGROW Shadow MPC

Board of Directors