The Reserve Bank of India has decided to maintain status quo and retain the repo rate at 6.5 per cent, RBI Governor Shaktikanta Das announced on Friday. This is the seventh consecutive time the central bank has decided to hold repo rate at 6.5 pc.
Announcing the first bi-monthly monetary policy for the current financial year, Das said the Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged. The rate increase cycle was paused in April last year after six consecutive rate hikes aggregating to 250 basis points since May 2022.
The six-member rate-setting panel by a majority vote of 5:1 favoured the status quo on the interest rate, while maintaining focus on the withdrawal of accommodative stance. In February, the Consumer Price-based Inflation (CPI) stood at 5.1 per cent.
The government has mandated RBI to ensure CPI inflation at 4 per cent with a margin of 2 per cent on either side. The RBI governor said they are keeping vigil against food inflation.
The central bank has projected a 7 pc for the current financial year. It also projected 4.5 pc inflation.
Das said as of March 29, 2024, India's Foreign exchange reserves reached an all-time high of $645.6 billion.
-with agency inputs.
