The rate decision as well as the voting pattern in today’s monetary policy review was along expected lines. The MPC lowered inflation forecast for FY22 to 5.3% (from 5.7% in the August review), mainly due to lower expected inflation prints in Q2 and Q3. While it retained growth forecast for FY22 at 9.5%, it added that the external environment is turning more uncertain and challenging. On the regulatory front, the RBI extended SLTRO for small finance banks till Dec 2021, decided to continue with extended WMA limit till Mar 2022, and extended inclusion of on-lending to NBFCs in priority sector till Mar 2022. Also, the RBI discontinue GSAP and announced that it was open to supplementing 14-day VRRR with 28-day VRRR.