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BRIEF-India cenbank releases monetary policy committee minutes of Dec meeting
December 21, 2016 / 12:08 PM / 9 months ago

BRIEF-India cenbank releases monetary policy committee minutes of Dec meeting

Dec 21 (Reuters) - The Reserve Bank of India:

* India cenbank releases monetary policy committee minutes of December meeting

* India MPC member Ghate says “a negative demand shock because of the withdrawal of SBNs will lead to a decline in consumption demand” - cenbank minutes

* India MPC member Dua says “economic growth outlook going into the autumn months had become increasingly optimistic, underscoring the economy’s resilience to potential negative shocks” - cenbank minutes

* India MPC member Dholakia says RBI’s forecast of CPI headline inflation rate obtained by assessment of commodity groups in CPI basket for end of March 2017 is about 5% with some upside risks - cenbank minutes

* India MPC member Dua says “ growth in ECRI’s Indian leading exports index, a harbinger of India’s exports growth, was also in a decisive cyclical upturn” - cenbank minutes

* India cenbank executive director Patra: achieving 5 percent will imbue credibility into commitment of monetary policy to the inflation target of 4 percent

* India MPC member Dholakia says “range estimates of the same indicate a significant chance of inflation rate exceeding threshold in March 2017 and in June 2017” - cenbank minutes

* India MPC member Ghate says “what counters adverse effects of withdrawal of SBNs is the aggressive pace of digitisation, and fast restoration of transaction demand for money from re-tendering process” - cenbank minutes

* India cenbank deputy Gandhi: don’t see any significant downside risks to medium-term growth prospects of economy - minutes

* India MPC member Ghate says “paramount concern at this juncture has to do with the stickiness of inflation excluding food and fuel” - cenbank minutes

* India MPC member Dholakia says given the recent developments on sbns and related policies, “banking sector is likely to be flooded with liquidity for some time to come” - cenbank minutes

* India MPC member Dholakia says “both external and domestic economic environments are currently impacted by some unique uncertainties as pointed out in the resolution of the committee”- cenbank minutes

* India MPC member Ghate says committee should now focus on mid-point of medium-term inflation target of 4 +/- 2 percent given the lags associated with transmission of monetary policy - cenbank minutes

* India MPC member Dua says “on basis of Indian leading indices produced by ECRI, it can be inferred that the Indian economy was in a resilient state ahead of the decision to withdraw SBNs” - cenbank minutes

* India cenbank chief Patel says inflation excluding food and fuel remains sticky - MPC minutes

* India MPC member Dua says “it may be noted that a leading index predicts changes in economic activity and thus, cyclical turns in the economy” - cenbank minutes

* India MPC member Ghate says “because of increased uncertainty due to withdrawal of SBNs, and virtually no hard data for November, it would be prudent to ‘wait-and-watch” - cenbank minutes

* India cenbank chief Patel says global financial conditions pose a threat to macroeconomic and financial stability - MPC minutes

* India cenbank executive director Patra: critical to stay focused on inflation target of 5 percent for Jan-March of 2016-17- minutes

* India MPC member Dua says “improved exports growth may provide additional support to growth in economic activity” - cenbank minutes

* India cenbank chief Patel says large fluctuations in capital flows and asset prices will impart volatility leading to inflation - MPC minutes

* India MPC member Dua says “withdrawal of sbns is expected to have only a transitory impact on economic activity” - cenbank minutes

* India cenbank chief Patel says uncertainty shows no sign of subsiding - MPC minutes

* India MPC member Dua says “with a cumulative reduction in the policy rate by 175 basis points since January 2015, conditions are conducive for further transmission to lending rates by banks” - cenbank minutes

* India MPC member Dholakia says “my own point forecast based on a more aggregative econometric model is lower” - cenbank minutes

* India cenbank chief Patel says uncertainty likely to get accentuated in the coming year as us macroeconomic and trade policies realign - MPC minutes

* India MPC member Dua says “fully endorse the resolution to keep the policy repo rate unchanged at 6.25 per cent” - cenbank minutes

* India MPC member Ghate says “some disinflation will also come about because of the withdrawal of SBNs, although with a lag” - cenbank minutes

* India cenbank chief Patel says impact of the withdrawal of old high-value bank notes on growth, inflation is transitory - MPC minutes

* India cenbank executive director Patra: global developments including morphing of political changes into macroeconomic risks could likely be longer-lived and more challenging

* India MPC member Dholakia says “any policy intervention in terms of repo rate with acknowledged longer outside lags is likely to add to the uncertainties”-cenbank minutes

* Patel says important for monetary policy to stay focused on medium-term, strive to achieve middle of inflation target range of 4 percent - MPC minutes

* India cenbank executive director Patra: global developments warrant careful monitoring of the way forces play out and influence near-to medium-term policy

* Patel says higher allowances under the 7th pay commission award will impact inflation outcomes and inflation expectations in 2017-19 - MPC minutes

* Patel says implementation of the GST could produce a one-off step-up, albeit modest, in inflation - MPC minutes

* Patel says achieving inflation target of 5 percent for Q4 of 2016-17 and securing 4 percent midpoint of target range remains the primary objective - MPC minutes Source text: (bit.ly/2h9rGCA)

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