RBI retains economic growth projection at 6.7% for FY’18

The Reserve Bank on Wednesday retained economic growth projection for 2017-18 at 6.7 per cent saying that the risks are evenly balanced.

In its Fifth Bi-monthly Monetary Policy Statement, 2017- 18, RBI said that the second quarter growth was lower than the one that was projected in the October review, and the recent increase in oil prices may have a negative impact on margins of firms and Gross Value Added (GVA) growth.

“The projection of real GVA growth for 2017-18 of the October resolution at 6.7 per cent has been retained, with risks evenly balanced,” the central bank said.

It said shortfalls in kharif production and rabi sowing pose downside risks to the outlook for agriculture.

On the positive side, RBI said there has been some pick up in credit growth in recent months.

Besides, recapitalisation of public sector banks may help improve credit flows further, it added.

(Agencies)

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