Edited Transcript of the Reserve Bank of India’s Post-Monetary Policy Press Conference: June 5, 2026 (Friday) -

Participants from the Reserve Bank of India:

Shri Sanjay Malhotra - Governor, Reserve Bank of India

Shri Swaminathan J - Deputy Governor, Reserve Bank of India

Dr. Poonam Gupta - Deputy Governor, Reserve Bank of India

Shri Shirish Chandra Murmu - Deputy Governor, Reserve Bank of India

Shri Rohit Jain - Deputy Governor, Reserve Bank of India

Dr. Ajit Ratnakar Joshi - Executive Director, Reserve Bank of India

Shri Sanjay Kumar Hansda - Executive Director, Reserve Bank of India

Shri Indranil Bhattacharyya - Executive Director, Reserve Bank of India

Moderator:

Shri Brij Raj - Chief General Manager, Reserve Bank of India

Brij Raj:

Good afternoon, everyone. Welcome to this Post Policy Press Conference, second for the Financial Year 2026-27. We have with us Governor, Reserve Bank of India - Shri Sanjay Malhotra; along with Deputy Governors - Shri Swaminathan J, Dr. Poonam Gupta, Shri Shirish Chandra Murmu, and for the first time, Shri Rohit Jain. We also have with us Executive Directors - Dr. Ajit Ratnakar Joshi, Shri Sanjay Kumar Hansda and Shri Indranil Bhattacharya. I also welcome my other colleagues from the Reserve Bank.

Before we begin, we have a few housekeeping announcements. Sir, there are 25 participants from the media. I request the media participants to please stick to one question. I am repeating, please stick to one question so that everyone gets a chance. In case time permits, we can take some more questions. I also request everyone to please switch on the mic while speaking so that those watching the live telecast are able to hear clearly. And once you have finished speaking, please switch off the mic. Sir, with your permission, I will now call out the names.

Sanjay Malhotra:

Yes.

Brij Raj:

Thank you, Sir. I will request Ms. Latha Venkatesh from CNBC-TV18 to please ask the first question. Latha, please.

Latha Venkatesh, CBNC TV18:

Thank you, Brij. Thank you, Governor. Well, a bazooka of a policy, Sir. The market is pouring its congratulations. I wanted to know if you can give us some more details on the ECB and FCNR scheme. Especially FCNR, last time it was excused from CRR and SLR. And banks were allowed to give loans and get their customers to raise FCNR. So, it was not just their money, even leverage was allowed.

Can you just elaborate, because that will give an idea of how much they can expect? And anyway, what is an idea of the flows - what kind of flows are you expecting with everything; ECB, FCNR, and the other steps that you all have announced, NRI, etc.? Thank you, Sir.

Sanjay Malhotra:

The details, we will come out shortly. We are still working out the details, but broadly the contours were already mentioned. In terms of CRR and SLR, that dispensation will certainly be given. Other than that, I don't think there is any change in the regulatory dispensation. So that - whatever is the existing dispensation / regulation, with regard to that, there is no special dispensation for that.

In terms of the quantum, we are hopeful of a reasonable and good amount - we are not targeting any particular amount, but we do expect healthy flows - both from ECBs and other various measures that have been announced today. So, as a result of all these measures, we expect healthy flows not only in this period of three to four months that we have given - short window for ECBs and FCNR (B) deposits, but there have been other measures for equity as well as government bonds. All put together, we are quite hopeful - and there were other measures, which were taken even earlier, whether it is in terms of the ECBs, liberalized ECB scheme that we brought in and the measures that I mentioned in the Monetary Policy statement with regard to government initiatives in terms of the trade agreements, etc. All those put together, we are quite confident of a very healthy, a much better BoP this year as compared to what it would have been otherwise.

Brij Raj:

Thank you, Sir. We will take some more questions from our left side before we come to the right side. I will now request Manojit Saha from Business Standard to ask his question. Manojit, please.

Manojit Saha, Business Standard:

Thank you, sir. Now, can we assume that for the time being, since you have not mentioned that when the RBI expects inflation to come back to 4%? Can we expect that RBI has now put the 4% target in abeyance for the time being and is more focused on the range like we did in COVID times? Because from your statement, I think it is evident that you are more concerned with growth rather than inflation. So, is the 4% target kept in abeyance for the time being?

Sanjay Malhotra:

No, the target is not in abeyance at all. It's a target which is sacrosanct for us. It's a target which the government has given to us. It was reviewed. It remains 4% and that is what our endeavour is. But keep in mind that this target is to be met over a period. It's a medium-term kind of a target. And it is not advisable to take action for each and every small or large, especially small deviations from the target because that can have consequences which can be disproportionate for growth. So, our target remains the same. It is 4%. It is to be met over a period of time. And as mentioned, we will be data dependent.

We have to watch and see as to whether the effect of this supply shock is going to persist or whether it is going to wane away. So, we are watching for that. And I think the details are already there in the Monetary Policy statement. We will be very watchful if inflation is getting generalized, building into expectations, and, accordingly, take action.

Manojit Saha:

The concern is the real rate is now very, very small or even negative.

Sanjay Malhotra:

See, as I mentioned to you, we have to look at it over a little longer period. It's not possible nor is it desirable. It's neither possible nor is it advisable to have it pegged in a very small range. And that's why we have this range. The range of 2% to 6% is primarily for this purpose. While the endeavour, the focus, the target is 4%, but there can be fluctuations around that. And we do not, if there are really fluctuations and then inflation is coming down on its own, then we don't apply monetary policy tools which will have other adverse consequences.

Manojit Saha:

Thank you, Sir.

Sanjay Malhotra:

In the interest of everyone's time, let's restrict ourselves to one question at a time and then if there is time and the question has not been asked by anyone else, then we come back. Okay?

Brij Raj:

Thank you, Sir. I will now request Anup Roy from Bloomberg to ask his question. Anup, please.

Anup Roy, Bloomberg:

Thank you, Sir. Sir, in a recent interview, you have said that Rupee is undervalued. So, what is, as per your estimate, the fair value?

Sanjay Malhotra:

Which interview are you talking about?

Anup Roy:

In Mint interview, you have said Rupee is perhaps undervalued.

Sanjay Malhotra:

I have never said that Rupee is undervalued. I think what you are referring to is the fact that I mentioned that, you know, it may be - I think if I recall correctly, I said something to the effect that it is reasonable to think that it may not be overvalued. And some people, of course, do say that it is when they look at REER, etc., then they do say that it is undervalued. So, this is what I said. I never said that it (INR) is undervalued, but by some accounts, yes, it is undervalued.

Anup Roy:

So, what could be the fair value if you have done any analysis?

Sanjay Malhotra:

See, you know, our policy has been consistent. This question keeps coming up again and again and we keep giving out the same answer. I do not have anything more to add than what I said in the Monetary Policy statement.

Anup Roy:

Thank you.

Brij Raj:

Thank you, Sir. I will now request Hamsini Karthik from Moneycontrol to ask her question. Hamsini, please.

Hamsini Karthik, Moneycontrol:

Thank you, Brij. Thank you. Good afternoon to everyone. My question is on deposit and lending rates. Earlier in your policies, you have said that at RBI, you would endeavour to maintain rates at a certain level which would be slightly low. You are not in a rush to increase rates. Would you continue to maintain that stance even today, given where geopolitical situations are and what other economies are doing with the monetary policy tools? And as an allied, I would also want to draw your attention to deposit rate. In your speech, you mentioned that there is a certain amount of hardening of lending and deposit rates as well. We recently had a very large private sector bank say that they had to resort to a very competitive structuring of deposit to ensure that they are able to combat this excessive competition for deposits.

Is that a practice at RBI that you would allow, that you are okay with? And given that deposit rates have continued to be very elevated, I mean, it has been a pressure to mobilize deposits. I think we are in the third year of that. Where do you see some sort of a relief coming for banks?

Sanjay Malhotra:

See, as far as deposit rates are concerned, there is no regulation on that. So, I am not understanding as to the intent of your question.

Hamsini Karthik:

I primarily like to understand, Sir, is there a room based on the macro environment today, do you foresee low interest rates continuing to prevail in the country for a while and what would be the allied impact of that on deposits?

Sanjay Malhotra:

So, see, that is futuristic. We will be data dependent, and we will see how the growth-inflation dynamics plays out as I have already mentioned. I think on rates - policy rates going forward, I will not be able to give you more guidance than what was given in the statement and what I mentioned when I answered one of the previous questions.

Hamsini Karthik:

Regarding competition for deposits, any view that you have?

Sanjay Malhotra:

If there is competition, it is healthy. Competition is good as long as it is transparent, as long as it is fair, and that should continue.

Hamsini Karthik:

Okay.

Brij Raj:

Thank you, Sir. I will now request Ekta Suri from Zee Business to ask her question. Ekta, please.

Ekta Suri, Zee Business:

Good afternoon, Sir. I would like to ask if the RBI has any target regarding NRI deposits? And here, because we are talking about maintaining our forex reserves, Modiji also appealed that people should buy less gold. Is the RBI thinking about making the Gold Monetization Scheme more lucrative? And just if time allows, one more question?

Sanjay Malhotra:

You have asked two questions. The third, if there is time, you can ask. So, firstly I said that we have not set any target for this, but we hope that quite a healthy and large amount of flows will come in through the various measures we have announced today. Secondly, regarding the Gold Monetization Scheme, there is no such proposal under consideration right now.

Ekta Suri:

Thank you, Sir.

Brij Raj:

Thank you, Sir. I will now request Anurag Shah from ET Now Swadesh to ask his question. Anurag, please.

Anurag Shah, ET Now Swadesh:

Thank you, sir. Thank you, Sir. Sir, I would like to understand a question related to common people, Sir, because people have trust in the RBI, and you can assess it correctly.

Sir, how does the RBI view the current economic situation, how challenging is it? And for the RBI, what will be the concern going forward, will it be growth, or will it be inflation? Because in the assessment of growth, you said today that the burden sharing, going forward will also be very important, it will determine growth. So, Sir, how do you see that?

And Sir, nowadays there is a lot of discussion in India regarding the level of the Rupee compared to the dollar - intellectuals, economists, everyone is giving their opinion. So, Sir, how is the RBI looking at it? Is this just part of a process, or if in the near future, it becomes a three-digit figure, is it just a number, nothing more?

Sanjay Malhotra:

Look, our economic situation, as we have said in our statement as well, it is quite strong and healthy. This global shock, India is not alone in it. All countries are impacted by it. So, as far as India is concerned, we are not only, as compared to other countries, in a much better position today in terms of the current shock but also with respect to the earlier shocks that have been faced by us. As regards our economic growth, which is more than 6.5%, very few countries have it, and it is not there in any of the major economies.

And as far as inflation is concerned, inflation will definitely increase because if the oil prices have increased, then they are increasing everywhere. But we can only hope that it does not stay for a long time, there is a lot of uncertainty, we will know later. But our economic condition is very good, and growth is healthy. Our banks are sound and resilient. Corporate balance sheets are also healthy. The external situation, you talked about the currency, our forex reserves are sufficient to cover imports for about 11 months. Overall, we are in a very good position, and we are very confident that we will not only deal with this situation well, but will make ourselves more capable and better by considering this situation as an opportunity before us so that we can deal with such crises and shocks in a much better way.

Brij Raj:

Thank you, Sir. Sir, we will now take a few questions from the right. I will now request Sangita Mehta from Economic Times to ask her question. Sangita, please.

Sangita Mehta, Economic Times:

Sir, given that influx of inflows that might happen because of the measures announced, what kind of system-level liquidity you think would be appropriate in the current scenario? And do you expect banks to pass on the benefits of hedging costs to the customers respectively?

Sanjay Malhotra:

Yes, I do expect them to pass on some of the benefits of hedging and that will result in good flows. Liquidity, as I have mentioned, we will provide the appropriate amount of liquidity so that credit in the system, not only bank credit, but other bonds, etc. also can be provided to meet the needs of the economy. There is no level that we generally target. You have seen we gave about ₹2.6 lakh crore of liquidity in the last 2 months since we have met, and we will continue to provide appropriate liquidity as needed.

Brij Raj:

Thank you, Sir. I will now request Jaspreet Kalra from Thomson Reuters to ask his question. Jaspreet, please.

Jaspreet Kalra, Thomson Reuters:

Thank you, Sir. Sir, you have announced measures aimed at guarding capital inflows today via FCNR, ECB, etc. Are you also considering measures to slow down outflows, perhaps through restrictions on liberalized remittance schemes, overseas debt investments? Is that something under consideration and because some of my peers took the liberty, I hope you will allow me.

You speak a lot about inflation expectations. In the recent data that we have seen in RBI surveys, they started to drift up. How do you sort of closely track that? Are there supplementary tools that you are looking at, may be measure inflation expectations in more real time, to be able to stay ahead of the curve? Thank you.

Sanjay Malhotra:

See as and when, first of all, there is no such measure right now under consideration to restrict any kind of capital outflows. On your second question, which is related to inflation expectations, we do our household surveys. So, that is the primary source through which we get the data. And other than inflation expectations, the prices when they are passed on, that can also have some element of expectations built into it, apart from the surveys that we do. We monitor those very closely and we will continue to do that.

Brij Raj:

Thank you, Sir. I will now request Piyush Shukla from NDTV Profit to ask his question. Piyush, please.

Piyush Shukla, NDTV Profit:

Good afternoon, Governor, DGs. Thanks, Brij sir. We understand the updated list of NBFCs is yet to come out. You have issued a categorization draft circular. There are views floating around on one CIC which has applied for deregistration as well. When can we expect the next upper layer list to come out? And if you could allow me to ask, because this is the largest private bank of the country, we have seen a lot of developments happening with regard to how its governance is being played out. Is the regulator concerned in any manner on this aspect? Thank you.

Sanjay Malhotra:

See, you are aware, we don't answer any entity or bank-specific questions. We are looking at system level things. So, that is on your second part of the question. Your first part is?

Piyush Shukla:

Updated layer of (NBFCs).

Sanjay Malhotra:

See, the list is already there. So, it continues till the time we have a new list.

Piyush Shukla:

When will we have it? I suppose it gets updated on a yearly basis. That is why I am asking?

Sanjay Malhotra:

We will do it shortly.

Brij Raj:

Thank you, Sir. I will now request Ankur Mishra from ET Now to ask his question. Ankur, please.

Ankur Mishra, ET Now:

Thank you, Brij sir for the opportunity. Good afternoon, Governor. You mentioned during the Monetary Policy statement that the crude oil prices have been more than the assumptions which were there in the last Monetary Policy. I want to understand what is the assumption, now?

Apart from that, you also mentioned about the exchange rate policy where you are saying about speculative pressures and how Reserve Bank of India responds to that. In the past, you have taken few measures regarding the same. Are there more measures which are expected from Reserve Bank of India?

Sanjay Malhotra:

No, there are no specific measures, but as I have mentioned, in case they are required, especially to curb speculative kind of a behaviour, then we will take them in case they are required. Assumption for crude is USD95 to a barrel. So, it is changed, you know, from our previous ones, and previous assumption - and that is one of the reasons, you know, why inflation is higher - projected inflation is higher.

Brij Raj:

Thank you, Sir. I will now request Shayan Ghosh from Mint to ask his question. Shayan, please.

Shayan Ghosh, Mint:

Governor, on the issue of deposits. Generally, I mean, what has happened with the banks, they also justified it as an industry practice. My question is, as an industry practice - the practice of giving differential interest rates and masking it probably…

Sanjay Malhotra:

No, our policy - I mean, we do allow differential interest rates. So sorry, let please complete your question…

Shayan Ghosh:

On the systemic level, I was asking because they justified it saying that it is an industry practice. Is RBI okay with an industry practice like that, where you give differential interest rate but routed through something else?

Sanjay Malhotra:

I think you are referring to some individual specific instance / bank, which we do not comment on. However, as I have mentioned, I think perhaps now I - the earlier question I think they are too connected - they are connected. So, we have a very consistent and a very clear policy for deposits as to when they can have differential rates.

I think for certain categories of people like, senior citizens, depending on and then, depending on tenor and things like that, you can have differential rates. I'll ask one of my colleagues to tell you on what basis you can have differential rates, but they have to be transparent at the same time. You have to display them to everyone clearly and any differential rate beyond that if someone is giving, is certainly not acceptable.

Brij Raj:

Thank you, Sir. I will now request K. Ram Kumar from The Hindu Business Line to ask his question. Ram Kumar, please.

K. Ram Kumar, The Hindu Business Line:

Why is this concessional swap facility for raising ECBs restricted only to public sector undertakings? Why not extend it to even the private sector actually?

Sanjay Malhotra:

See, the Public Sector Entities are a special category, and they are more, in areas where we feel the needs of - where the needs of the economy are more. And the benefits are also, passed on to the general public because they are catering more, to public utilities, infrastructure. So, the benefits go to a much larger section of society when we restrict - when we give it to the public sector undertakings. If we give it to private entities, then the benefits are not as widely dispersed as they are when we give such kind of a benefit to the PSUs.

Brij Raj:

Thank you, Sir. I will now request Mayur Shetty from The Times of India to ask his question. Mayur, please.

Mayur Shetty, The Times of India:

Thank you, sir. Governor, you announced a whole lot of measures to attract fixed income inflows. Do you see a role for interest rates here? In the past, whenever such measures were taken, there were higher rates offered to attract capital or do you expect banks to offer better returns under these schemes?

Sanjay Malhotra:

Yes, obviously. Because I think one of you asked, this will enable banks to increase the deposit rates for the non-resident and the OCI depositors.

Mayur Shetty:

This is despite the reduced interest rate differential between India and…

Sanjay Malhotra:

Yes.

Brij Raj:

Thank you, Sir. We will now take the remaining questions from the left side. I will request Falaknaaz Syed from Deccan Chronicle to ask her question. Falaknaaz, please.

Falaknaaz Syed, Deccan Chronicle:

Good afternoon, Governor. Thank you for the opportunity. Sir, there is a 50 basis points upward revision in baseline CPI inflation forecast with upside risk. So, this strengthens a case for a rate hike in the next meeting. And also, if you look at the bond market, they are factoring three rate hikes. The yields are now around 7% -10-year G-sec benchmark yield.

Sanjay Malhotra:

So, what's your question?

Falaknaaz Syed:

The question is that it is strengthening - the 50 basis revision in - with upside risk in CPI, it's strengthening a case for a rate hike in the next meeting?

Sanjay Malhotra:

In the next meeting or later, whether it strengthens the case or not, I don't know. But obviously, I mean, it's more adverse, than it was previously, certainly. Yes, whether it strengthens the case will depend on many other things as already mentioned. We will have to see whether it is actually getting generalized. It is not as I mentioned, again and again, it is not, just one - if it is a one-time increase, then you look through. But if it is getting generalized, it is getting persistent, it is getting into expectations, then is the time to act. So, for that, you know, we have to wait, and we have to watch.

Brij Raj:

Thank you, Sir. I will now request Krishn Kaushik from Financial Times to ask his question. Krishn, please.

Krishn Kaushik, Financial Times:

Hi. Good afternoon, Sir. So, I want to understand - you mentioned that there is a good environment for private capital investments to grow. But have you seen private capital expenditure growing? Because there has been a bit of a frustration on the government side on that as well that private entities are not investing enough. Along with that, why do FPI inflows remain negative? You mentioned that in the first 3 months or the first 2 months, till now basically, it has been about USD14 billion that has outflowed. So why are these two things? Can you just comment on that, Sir?

Sanjay Malhotra:

See, investments are healthy. If you look at data, rather the data for the second advance estimates for last year and if even if you look at some of the high-frequency indicators in terms of capital goods imports, production, H1 numbers of fixed asset growth. H1 was very good, it was in two digits. H2 has moderated, but it is still in a high single digit. So, if you look at all these indicators, it is decent. Of course, there is always scope for more.

Inflows have also been there. FDI, I think, we gave you the numbers. Gross FDI is continuing to rise. Madam [DG (PG)], would you like to add on the remittances and on the inflows as to how, the situation looks like?

Poonam Gupta:

So, I can add to the overall situation of capital flows as well as capital investment in the country as Sir said. Private capital formation numbers actually have been very healthy. Investment to GDP ratio has been turning upwards. So those numbers remain healthy, more can certainly happen.

If we look at the BoP side, gross FDI flows were USD95 billion in 2025-26, can be much more this year for all we know. Certainly, top USD100 billion, can go up to, you know, USD110, USD120 if not more. And it is a secular increase, which means it is not a story that we can pin down to only one year. You know, there are years coming which will see even healthier inflows of gross FDI. And with the measures that have been announced, we are looking at and projecting a very healthy BoP, going forward.

Krishn Kaushik:

Net still remains negative, right? FDI.

Poonam Gupta:

So, we do not have projections for this year and that remains to be seen on how things pan out. Net FDI is also a combination of, globally how things are and those are things that get settled over a period of time. But one can talk more confidently today about the gross FDI numbers which are looking very healthy.

Sanjay Malhotra:

Net FDI was also positive. It was not negative, USD 6.7 or so last year. And April numbers, gross FDI is USD 15 billion, and net is also about USD 7 or 8 billion, if I remember correctly. That's also positive. So, USD 15 billion in one month is a very high number. We don't have the monthly figures, but a lot of it was to do with the financial sector. So, we are confident as DG (PG) also mentioned.

Brij Raj:

Thank you, Sir, and thank you, Madam. I will now request Lalatendu Mishra from The Hindu to ask his question. Lalatendu, please.

Lalatendu Mishra, The Hindu:

Good afternoon, Governor. Last month, the Prime Minister has urged the people of India to do a lot of things, you know, like not to go for foreign travel, postpone buying gold, do work from home, do carpooling and reduce fuel consumption.

And now you told in response to Anurag's question, that things are better. Have things changed since then and what could be the reason for him to tell all these things? Thank you.

Sanjay Malhotra:

You have to ask him, and you have to ask yourself as to what the reason therefore is. I think it's important for all of us, to be prudent, to be judicious, to not be wasteful. That's the message I think he gave, and it should be taken in that spirit.

Brij Raj:

Thank you, Sir. I will now request Nachiket Kelkar from Business Today to ask his question. Nachiket, please.

Nachiket Kelkar, Business Today:

Thank you, Governor. Seemingly, there is enough cash in circulation, but we also keep hearing that ATMs are running short of cash, they are running dry. Is RBI looking at it? What are the issues there? Are you worried about it? Or something needs to be done there?

Sanjay Malhotra:

See, we have a plan. Every year we build a plan of what the requirement of currency is and that is provided to the banks as and when it is required. The ATM part I have not looked into, but certainly, we will - if there is a shortage, we will certainly ensure that the shortage is met with. We have sufficient currency to provide and fill and refill the ATMs and the bank branches.

Brij Raj:

Thank you, Sir. I will now request Manish Suvarna from PTI to ask his question. Manish, please.

Manish M. Suvarna, PTI:

Thank you, Brij sir. Good afternoon, Sir. Sir, you mentioned that you are expecting good amount of flows because of the measures you have announced today. So how much incremental flows can we expect? And secondly, Sir, I just want to understand, you explicitly flagged implication for the rural demand from projected monsoon deficiency. So, do you see a risk of weaker rural consumption spilling over to the private consumption growth?

Sanjay Malhotra:

Number I already mentioned, we don't have a specific number, but obviously, it's all put together, it will be very healthy. Answer to your second question, rural demand, well, yes, private consumption, well, yes, some impact will be there.

Brij Raj:

Thank you, Sir. I will now request Akash Mandal from Indian Express to ask his question. Akash, please.

Akash Mandal, Indian Express:

Good afternoon, Governor, Deputy Governors. The RBI has intervened heavily in the forward market in the past year or so, with the RBI also bearing the full hedging cost of the new three-to-five-year FCNR (B) deposits in addition to the concessional forex swap window for the ECBs of PSUs. Does the RBI expect some forex pressure going ahead and how does the central bank expect to mitigate or manage this risk going forward?

Sanjay Malhotra:

No, we don't expect, but we are always prepared. As mentioned, we have sufficient reserves, and we have the buffers. And we will do whatever is required in order to ensure that we have good flows, and we are able to maintain an orderly movement of the Rupee. These are the primary areas that we will focus on.

Brij Raj:

Thank you, Sir. We will now take the remaining questions from the right side. I will request Shyama Mishra from Doordarshan to ask her question. Shyama, please.

Shyama Mishra, Doordarshan:

Namaskar Sir. Sir, in your statement, there was one word which was continuously coming, that is uncertainty. Which is that one risk that you are watching very closely right now? And one more thing, gold reserves or gold holdings is constant. So, is it a policy to not trade in gold?

Sanjay Malhotra:

No, we don't - there was some news, you know, that we have sold gold or something, so there is no such sale. There is only a marginal increase in our gold holdings. Uncertainties on various accounts. It's on account of the conflict, the duration of the conflict, the time it will take for restoration of supplies. There is uncertainty about the Monsoon, the El Nino. So, there are various uncertainties which have implications for both inflation and for growth. So, we will be watching, all these uncertainties as to how they fold out and what impact they have.

Shyama Mishra:

Sir, any one risk that you are really worried about it?

Sanjay Malhotra:

No, the major risk today or concern or uncertainty is how long, these supply disruptions continue and what impact they have on prices. Availability as of now is not so much of a concern. It's more, as of now, the price. So that is what we are looking for as to how long that remains. That I think is number one, after that, will be the monsoons and the El Nino and other things.

Latha Venkatesh, CNBC TV18:

Sir, may I interrupt? This confusion over gold came because weekly bulletins show a reduction - yes, and I think you all mark-to-market…

Sanjay Malhotra:

In tonnes? Okay.

Latha Venkatesh:

No. that is in dollars…

Sanjay Malhotra:

That is in dollars, right.

Latha Venkatesh:

So, it must be a price revaluation.

Sanjay Malhotra:

Right.

Latha Venkatesh:

Maybe you all can clarify. Is it done every month, is it done alternate Fridays, or I don't know what? Then this confusion...

Sanjay Malhotra:

No, whenever we give out the numbers, then obviously, the value would be with the same frequency. I think we do it weekly.

Latha Venkatesh:

Yes, the amount is given weekly.

Sanjay Malhotra:

We give it weekly, so the price will also be changed weekly. It will be revalued weekly. I mean, it cannot be that you give the value weekly, and the price is adjusted at a different frequency. I mean, that is my understanding, and I suppose that's how it should be.

Brij Raj:

Thank you, Sir. I will now request Kshipra Petkar from Financial Express to ask her question. Shipra, please.

Kshipra Petkar, Financial Express:

Thank you, Brij, sir. Good afternoon, Governor. My question is on the transmission of rates. Now, despite cumulative policy easing, transmission across segments in the financial system remain uneven. Even in the Annual Report, there was data which said that for FY 2025-26, Agri saw transmission of a decline of 49 basis, whereas MSME saw decline of around 85 basis points. Now, is the RBI satisfied with the pace of transmission and are there any areas where further improvement is needed?

Sanjay Malhotra:

The credit growth, the proof of pudding is in eating it. I think credit growth has been very robust at 16% plus. Banking total put together is at 15% plus. So, it is satisfactory. Given, the whole economic macro-economic situation the way it is, I think it is quite satisfactory and we'll continue to work on further improving it wherever we find there is scope.

Brij Raj:

Thank you, sir. I will now request Aaryan Khanna from Informist Media to ask his question. Aryan, please.

Aaryan Khanna, Informist Media:

Thank you, sir. Sir, just one clarification on the FX measures. On both the ECB concession window as well as the FCNR (B) measure, will you allow all applicants who, apply for that window for those windows until September 30th or is there a cap that you have in mind? So that's, just one clarification I would like.

And the question is that looking at the inflation forecasts going ahead in FY27, did the MPC discuss a rate hike because these measures on capital inflows are external to the MPC. So did the MPC discuss a rate hike, possibly in this meeting, either because of inflation or because of the currency? Thank you.

Sanjay Malhotra:

So cap, I think you are talking about the in terms of value, right?

Aaryan Khanna:

Right, Sir.

Sanjay Malhotra:

Because the period is already there. No. So, as I have said there is no target that we have set for ourselves and when we meet the target, and we close that window. No, that is not the case.

As to whether the Monetary Policy Committee discussed whether to rate hike or not, that is the whole purpose of the meeting. Whether to hike, whether to retain, or whether to reduce, that's the purpose of the meeting. So certainly, all possibilities are discussed and after that a decision is taken.

Brij Raj:

Thank you, Sir. I will now request Saurav Mukherjee from ANI to ask his question. Saurav, please.

Saurav Mukherjee, ANI:

Thank you for giving me the opportunity, sir. My question to you is you recently warned or cautioned against the excessive speculation in the Rupee. Was the RBI message aimed at discouraging short sellers from building aggressive one-way bets against the currency? And your take on the government-issued ordinance to exempt FIIs from capital gains tax on G-Secs. What impact it may have on Indian economy?

Sanjay Malhotra:

It's a positive move, as mentioned earlier. It will further strengthen our balance of payments and so it's a welcome move.

Saurav Mukherjee:

And on the Rupee speculation, Sir?

Sanjay Malhotra:

I don't have anything more to add. See, if there is any speculation, excessive speculation - a speculation which leads to excessive volatility, let me put it like that - any disorderly movement that we see, it's then that we intervene and we take appropriate macro prudential, regulatory measures and will be watchful, we will be vigilant, and we will take measures as may be necessary.

Brij Raj:

Thank you, Sir. I will now request Jeevan Bhawasar from Akashvani to ask his question. Jeevan, please.

Jeevan Bhawasar, Akashvani:

Namaskar, Sir. Sir, there is a discussion in the market that RBI is going to launch plastic banknotes on an experimental basis or for testing. How much truth is there in these discussions? And my second question was on the shortage of currency notes, at ATMs and bank branches. There were many complaints about it too. So, what are the measures being taken by the RBI in this regard and why are we facing this problem again and again?

Sanjay Malhotra:

As regards polymer notes, the proposal is currently under consideration. We will let you know as soon as a decision is made. So whatever news articles have come, there is some truth in it, but there is no decision. It is only under consideration. We are examining the pros and cons of it and whether, you know, it will be worthwhile to do it. It is still at a preliminary stage. And on your second question on ATMs, we will make every effort to ensure that wherever there is shortage of currency in any of the ATMs, we will deliver the currency there at a quick pace.

Brij Raj:

Thank you, Sir. I will now request Soumyajit Saha from Nikkei to ask his question. Soumyajit, please.

Soumyajit Saha, Nikkei:

Good afternoon, Governor. So, we have seen some of our Asian peers like Thailand and Indonesia who are ahead of us in the same cycle face a little bit of a, not a little bit, but a fairly good amount of shortage in fertilizers. I just wanted to understand now that the lower monsoon forecast is pretty much unanimous across private and government forecasters, what is your updated understanding of the fertilizer crisis and its percolation down to food inflation, if you could give us some updates?

Sanjay Malhotra:

My understanding is that we have sufficient fertilizer supplies for the Kharif crop and in any case, if the monsoon is going to be, we don't know, if it is going to be sub-normal, then that only reduces, not increases, that's my understanding of fertilizers because if there is less rainfall, then you can't apply, that's my understanding of the issue. But there is sufficient fertilizer stock with the government.

Ekta Suri, Zee Business:

Sir one?

Sanjay Malhotra:

Okay.

Ekta Suri:

Sir, on 100% collateral and bank guarantees for prop trading, you gave some relaxation and extended the date (for implementation of instructions) from April 1st to July 1st. So, is further relaxation possible now, or will it be implemented on July 1st?

Sanjay Malhotra:

No, that will happen. We did not give any relaxation; we only extended the implementation date because there was very little time to implement the instructions. We did not give any relaxation or any exemption.

Ekta Suri:

So, will you extend this any further?

Sanjay Malhotra:

No there is no requirement or scope to extend the duration. There is no need. We only extended the date of applicability of the circular and the rules. It should not be seen as a relief in that sense.

Manojit Saha, Business Standard:

One more, Sir? Just one?

Sanjay Malhotra:

Last two.

Manojit Saha:

Now all these measures are in place. You think there is a case to continue or discontinue the NOP cap?

Sanjay Malhotra:

No, there is no change. Whatever is there, is there. There is no proposal to discontinue with what we had announced and what we have implemented.

Latha Venkatesh:

While your overall inflation forecast has been raised by 50 basis points from 4.6 to 5.1, for the second quarter itself, you all have raised it by 70 basis points, I mean, from 4.4 to 5.1. It is – would not it be unfair to a saver that, the real return for a good 12 months is going to be, you know, far less than 1%? So, shouldn't one not expect an earlier hike because of that? From the point of view of the saver.

Sanjay Malhotra:

I have already - you have asked the same question, you know, in a different form. The reasons you have given is different. Others are saying, you know, that inflation is inching up. You have said that the deposit - the depositors' interest may get compromised, for a longer period. So, let's wait, let's watch, let's see, how the data comes, and we will take a decision, you know, policy by policy.

Piyush Shukla:

Governor, Sir, just one question on Mythos. Anthropic has given access to a couple of corporates globally. In India also, there are a few companies which have got access. Have any of the banks, got the access to the new Claude model or how are you working around, assessing this whole issue?

Sanjay Malhotra:

I will request my DG, he [DG(SJ)] looks after cyber security. I will request him if he can throw more light on it. To the best of my knowledge, it has not yet been given. There is talk, there are discussions on Claude and others which hopefully, we will get. But what is the preparedness, I will request - whether there is, this Mythos LLM or software or not - what is our preparedness? Nevertheless, despite that, we are fully prepared, and we keep, beefing up. I will request my DG to let you know of some of the measures that we are taking to be able to meet this challenge.

Swaminathan J:

Absolutely, Sir. Just to supplement on that, this is an item that has been engaging our attention, both at the government level and at the financial sector inter-regulatory forum level. And as you mentioned, India has been included as one of the countries that will be part of this project with select corporates and financial entities having access to the project. But the details of which are still fully awaited.

And once this opportunity opens up, how exactly to make use of it in consultation with government and with other regulators, we will take further steps. But in the meantime, in terms of getting the preparedness for the regulated entities, we have issued the required advisories. We remain fully prepared in terms of handling cyber security threats of this nature as well as the conventional nature. And we will keep the market informed once we have full details as to how we plan to handle this. Thank you.

Piyush Shukla:

Okay. Thank you very much.

Brij Raj:

Thank you, Sir. With this, we come to the end of this press conference. I would like to thank the Governor and our Deputy Governors for patiently answering all the questions and making this interaction engaging and interactive. I thank all members of the media for their participation. Wish you all a pleasant day ahead. Thank you very much.

Sanjay Malhotra:

Thank you.