Wednesday, February 28, 2024

RBI Holds Repo Rate Steady, Prioritizing Economic Recovery and Inflation Control

The Reserve Bank of India (RBI) has announced the new monetary policy today. The Monetary Policy Committee of RBI, which ran from June 6 to 8, has decided not to make any change in the repo rate for the time being. This means that the repo rate will remain at 6.5 percent.

Two issues were very important before the Monetary Policy Committee headed by the RBI Governor. Firstly, to control inflation in the country and secondly, to deal with adverse global conditions.

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This meeting of the Monetary Committee of RBI was very important in view of the high retail inflation and the interest rate hike by the central banks of developed countries, especially the US Federal Reserve.

 

No Change In Repo Rate

The RBI Governor today announced the decisions of the Monetary Committee on the repo rate, reverse repo rate, and other related decisions. Apart from this, the governor also discussed the current domestic and global economic situation. However, before today’s announcement, many economists believed that there would be no change in the repo rate this time as well.

What Is The Significance Of This Decision?

In the decision taken by RBI Governor Shaktikanta Das, once again it has been decided to maintain the ongoing recovery in the country’s economy and not to make any change in the repo rate.

 

Let us tell you that in the MPC meeting held in February this year, RBI increased the repo rate by 25 basis points (bps). Earlier, RBI had increased the repo rate by 35 basis points in the December monetary policy review. From May 2022 to February 2023, RBI has increased the repo rate by 250 basis points i.e. 2.5 percent.

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