Disinflation to be slow and long: Das

• The RBI Governor recently said that the disinflation process in India will be slow and protracted, with the 4% inflation target likely to be met only over the medium term.
• While India’s inflation projection for the current financial year 2023-24 is lower, at 5.1%, it would still be well above the target.

RBI’s monetary policy committee (MPC) tasks

• Bringing down inflation to 4% over the medium term and holding it between 2% and 6% over the long term.
• Latest data showed India’s annual retail inflation cooled to 4.25% in May from 4.7% in April, but analysts expect prices to remain sticky in the coming months.
• The disinflation process is likely to be slow and protracted, with convergence to the inflation target of 4% being achieved over the medium-term.

Monetary policy committee (MPC)

• A statutory body established under section 45ZB of the Reserve Bank of India Act 1934.
• An institutionalised framework for maintaining price stability while pursuing the goal of growth.
• Set up based on the recommendation of the Urjit Patel Committee.

Prelims Takeaway

• MPC