InvestorQ : What were the key takeaways from the RBI annual report for FY22?
Angel dcosta made post

What were the key takeaways from the RBI annual report for FY22?

Juvina Maggie answered.
2 months ago

Here are some of the major takeaways from the RBI annual report for the financial year FY22 ended in March.

· The recovery of the Indian economy from the pandemic lows of 2021 was partially interrupted by the second wave, also called the Omicron wave. However, the impact of COVID on GDP was negligible in FY22.

· There has been some loss of momentum in growth in the fourth quarter but this is more due to factors like the Ukraine war, inflation in basic commodities, slowdown in China and Fed hawkishness. All these created supply chain constraints, impacting growth.

· The RBI was up against a major policy dilemma during the year. It had to keep policy accommodative to foster growth and at the same time it also had to control inflation which was literally going out of control.

· Capital flows remained robust with sustained strength in exports and revival in inbound remittances. The net capital flows also substantially contributed to the accretion to foreign exchange reserves. However, forex reserves have been falling consistently on account of RBI intervening to defend the rupee by selling dollars.

· In the annual report, RBI has also stressed that the Indian economy was better placed to sharpen the recovery underway.