RBI Keeps Repo Rate Unchanged At 6.5%

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(FE)

As widely expected, the Reserve Bank of India (RBI)-led Monetary Policy Committee (MPC) maintained the repo rate at 6.5 percent on Friday, given concerns about inflation. It is the seventh consecutive time that the central bank committee has kept the key lending rate unchanged. The repo rate, the rate at which the RBI lends to banks, remains a crucial parameter in this context.

RBI Governor Shaktikanta Das has consistently underscored the central bank’s commitment to steering inflation towards the 4 percent target. Despite February witnessing volatile food inflation, core inflation, excluding food and fuel, has exhibited a downward trajectory. However, concerns persist regarding the potential impact of weather fluctuations on inflation and economic stability.

Finance Minister Nirmala Sitharaman has indicated robust economic performance, with GDP growth exceeding 8 per cent in the first three quarters of FY24. This trend is anticipated to persist, leading some experts to predict an upward revision in the RBI’s growth projection for FY25.

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