RBI Monetary policy: The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) on Thursday decided to keep its key policy rates unchanged. RBI bi-monthly Policy Committee (MPC) meeting, which commenced its meeting on February 6, and will conclude its three-day deliberation today.
10 Key highlights
1.RBI keeps repo rate steady at 6.5% with five out of six members voting in favour of the rate decision Experts were also expecting expecting the repo rate to remain steady at 6.5 per cent
2. MPC also decided by a majority (5 out of 6 members) to remain focused on withdrawal of accommodation to ensure the inflation progressively aligns with the target while supporting growth. Monetary policy must continue to be actively disinflationary, RBI Governor Shaktikanta Das said in his statement.
3.This is the sixth consecutive unchanged decision and comes after the Interim Budget was announced on February 1, 2024.
4. With the latest announcement, while the Fixed Reverse Repo Rate is at 3.75%, the bank rate is 6.75%, the marginal standing facility (MSF) rate is 6.25%, and the standing deposit facility rate is at 6.25%
5. RBI Governor said that the MPC remained resolute on containing inflation at target of 4%.
6. The Reserve Bank of India (RBI) has maintained its inflation projection at 5.4% for 2023–2024.
7.The January-March 2024 (Q4FY24) CPI inflation forecast has been cut to 5.0% from 5.2%.
8. CPI inflation is predicted to be 4.5% for the upcoming fiscal year 2024–2025, with Q1 at 5%, Q2 at 4%, Q3 at 4.6%, and Q4 at 4.7%.
9. Momentum in economic activity is expected to continue in fiscal year 2024-25 said the RBI Governor. The FY25 GDP growth is estimated at 7%, the RBI Governor said.
10.GDP forecast for Q1FY25 has been raised to 7.2% from 6.7%, Q2FY25 raised to 6.8% from 6.5%; Q3FY25 GDP growth forecast raised to 7.0% from 6.4%, while Q4FY25 GDP growth forecast has been pegged at 6.9%.
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