RBI’s new repo rate: The Reserve Bank of India has kept the repo rate unchanged at 6.5%, with readiness to act if such a situation arises, announced RBI Governor Shaktikanta Das. He also pointed out that overall inflation is above target and the current policy rate still remains accommodative. He said that the real GDP growth for 2023-24 is estimated to be 6.5%.
The rate hike has been put on hold through May 2022 after six consecutive rate increases totaling 250 basis points.
Announcing the bi-monthly monetary policy, RBI Governor Shaktikanta Das said that the Monetary Policy Committee (MPC) will not hesitate to act in future.
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The RBI Governor informed that core inflation remains stable. Core inflation generally refers to inflation in manufactured goods.
Retail inflation stood at 6.44 per cent in February as compared to 6.52 per cent in the previous month. The MPC takes into account the retail inflation number to determine the interest rates.
However, inflation is expected to ease in the current financial year. Several institutions, including the World Bank and the Asian Development Bank, have predicted that inflation will ease to around 5 per cent this fiscal.
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For the next fiscal, the RBI projected a growth rate of 6.5 per cent, compared to 6.4 per cent estimated in February.
(With inputs from PTI)