RBI Defends Data Amid IMF Concerns

The Reserve Bank of India (RBI) has defended the accuracy of India's economic data and exchange rate management after the International Monetary Fund (IMF) raised concerns.

RBI Governor Sanjay Malhotra said the data on GDP and inflation is fairly accurate but acknowledged room for improvement.

Deputy Governor Poonam Gupta explained that India's data systems are generally rated well but receive a lower grade on national accounts due to an outdated base year.

She also clarified that India's exchange rate system is a managed float, similar to other emerging markets, and downplayed the IMF's classification of it as a 'crawling peg.'

The RBI emphasized that the IMF's assessment is based on cross-country comparisons and that India's policies are in line with global standards.

Additionally, the RBI described India's current economic phase as a 'rare Goldilocks period,' marked by high economic growth and exceptionally low inflation.

The RBI cut the repo rate by 25 basis points to 5.25% and revised the FY26 growth estimates to 7.3%, with inflation estimates lowered to 2%.