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Challenges yet to inflation and inflationary outlook Dr. Sunil Sinha, Principal Economist, India Ratings and Research (Fitch Group) expressed view on  RBI's Fifth Bi-monthly Monetary Policy Statement 2018-19 says, as expected RBI kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.5%. Although RBI has lowered its CPI inflation projection to 2.7%-3.2% in H2:2018-19 and 3.8%-4.2% in H1:2019-20 as against its earlier projection of 3.9%-4.5% in H2:2018-19 and 4.8% in Q1:2019-20, it still believes that there are challenges to inflation and inflationary outlook.   These could emanate from (i) volatility and sudden spike in prices of perishable food items, (ii) risk from revision in minimum support prices (MSPs) which has yet not played out fully, (iii) crude oil prices due to geo-political tensions/decision of OPEC to cut production, (iv) volatility in global financial market, (v) fiscal slippages and (vi) staggered impact of HRA rev

India to grow at 7.4% in 2018-19 LAF unchanged at 6.5 per cent Finance Ministry Statement on Fifth Bi-monthly Monetary Policy Statement, 2018-19 Resolution of the Monetary Policy Committee, Reserve Bank of India issued, on the basis of its assessment of the current and evolving macroeconomic situation, decided to keep the Policy Repo Rate under the Liquidity Adjustment Facility (LAF) unchanged at 6.5 per cent. The MPC has, however, retained its stance of ‘calibrated tightening’.     The GDP growth projection for 2018-19 is retained at 7.4 per cent as in the Fourth Bi-monthly Resolution in October, 2018.  The projections of inflation for 2018-19 and Q1:2019-20 have been substantially revised downwards from the October resolution. The Secretary, Department of Economic Affairs, Shri Subhash Chandra Garg in a Statement said that the assessment of the MPC for growth and inflation outlook is consistent with the Government’s assessment of inflation and growth.  Shri Ga