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The Reserve Bank of India kept the repo rate unchanged at 6.5 per cent on Friday amid expectations of softening price rise, but changed the policy stance to "calibrated tightening" from "neutral".
Even though analysts and bankers were expecting the six-member Monetary Policy Committee to go at least for a 0.25 per cent hike in key rates at the review, RBI chose to opt for a status quo.
"The MPC reiterates its commitment to achieving the medium-term target for headline inflation of 4 per cent on a durable basis," the resolution of the MPC after a three-day meet said.
The repo rate, at which the RBI lends to the system, will continue to be at 6.5 per cent and the reverse repo at which it absorbs excess funds will be 6.25 per cent.
The Monetary Policy Committee (MPC) voted 5:1 in favour of a status quo, with only Chetan Ghate voting for a 0.25 per cent hike.
The MPC headed by RBI Governor Urjit Patel said that the recent excise duty cut by the government on petrol and diesel will help contain inflation.
(With PTI inputs)
