Paper Number :WP18/2022
Publication Date :May 30, 2022
The “unscheduled” Monetary Policy Committee (MPC) announcement by Reserve Bank of India on May 2nd, 2022 marked a hike in repo rate by 40 basis points and a ‘withdrawal of accommodative stance’. This was followed by a sharp fall in Indian equity indices. The depreciation of rupee that has continued from April 2022 continued unabated. In this context, I discuss, using an event study analysis, the impact of MPC announcements on the equity and forex market for the period April 2020 to May 2022.