RBI's new repo rate: The Reserve Bank of India has kept the repo rate unchanged at 6.5% with readiness to act should the situation so warrant, announces RBI Governor Shaktikanta Das. He also informed that overall inflation is above the target and the current policy rate still remains accommodative. Real GDP growth for 2023-24 is projected at 6.5%, he added.
The rate hike has been paused after six consecutive rate increases aggregating to 250 basis points since May 2022.
Announcing the bi-monthly monetary policy, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) will not hesitate to take action in the future.
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The RBI governor pointed out that core inflation remains sticky. Core inflation generally refers to inflation in manufactured goods.
Retail inflation in February stood at 6.44 per cent compared to 6.52 per cent in the previous month. MPC takes into account retail inflation numbers for setting the interest rates.
However, inflation is expected to moderate in the current fiscal. Many institutions, including the World Bank and Asian Development Bank, have predicted that inflation would cool down to about 5 per cent this financial year.
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For the next fiscal, RBI projected a growth rate of 6.5 per cent as compared to 6.4 per cent estimated in February.
(WIth inputs from PTI)
