RBI keeps repo rate unchanged in policy review

The reverse repo rate under the LAF has been kept at 5.75 per cent, while the marginal standing facility (MSF) rate and the bank rate are maintained at 6.25 per cent.

The Monetary Policy Committee (MPC) of the Reserve Bank of India has kept the interest rate unchanged in its fifth bi-monthly policy statement of this fiscal year.
 
"On the basis of an assessment of the current and evolving macroeconomic situation at its meeting today, the Monetary Policy Committee (MPC) decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.0 per cent," RBI said in a note.
 
The reverse repo rate under the LAF has been kept at 5.75 per cent, while the marginal standing facility (MSF) rate and the bank rate are maintained at 6.25 per cent.
 
As per the note, "The decision of the MPC is consistent with a neutral stance of monetary policy in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth."
 
The statement said five members - Dr Chetan Ghate, Dr Pami Dua, Dr Michael Debabrata Patra, Dr Viral V Acharya and Dr Urjit R Patel were in favour of the monetary policy decision, while one member Dr Ravindra H Dholakia voted for a policy rate reduction of 25 basis points.
 
The projection of real GVA growth for 2017-18 has been retained at 6.7 per cent.
 
RBI, however, raised inflation forecast to 4.3-4.7 per cent in third and fourth quarters of current fiscal.

 


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