Reserve Bank of India (RBI) Governor Shaktikanta Das said the Monetary Policy Committee (MPC) has decided to keep the policy repo rate unchanged at 6.5 per cent as retail inflation remains above the target of 4 per cent.
This decision has been taken against the backdrop of economic uncertainties at the domestic and global level.
The MPC took a majority decision, with four out of six members agreeing to keep the repo rate unchanged.
As a result, the Standing Deposit Facility (SDF) rate remains at 6.25 per cent, while the Marginal Standing Facility (MSF) rate and the Bank Rate remain at 6.75 per cent.
Governor Das stressed the importance of a balanced approach to monetary policy in the post-policy press conference.
Das reiterated the Monetary Policy Committee's commitment to gradually withdraw accommodative measures to ensure that inflation remains within the target range while supporting economic growth.
The RBI Governor said, “Monetary policy should remain disinflationary and remain steadfast in its commitment to keeping inflation within the target range of 4 per cent on a durable basis and maintaining price stability on a solid basis.”
RBI has revised its growth projections for the current financial year 2024-25 to GDP growth rate of 7.2 percent. Quarterly growth projections are 7.3 percent for the first quarter, 7.2 percent for the second quarter, 7.3 percent for the third quarter and 7.2 percent for the fourth quarter. Governor Das highlighted that risks to the growth scenario are evenly balanced.
The decision to keep the repo rate unchanged signals RBI's cautious approach towards maintaining a balance between the objectives of controlling inflation and supporting economic recovery.
The announcement comes at a time when the global economy is grappling with uncertainties arising from geopolitical tensions and the impact of the Covid-19 pandemic.
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