- The
Reserve Bank of India will conclude the three-dayMonetary Policy Committee (MPC ) meeting today. - The central bank is expected to announce its decision on policy rates.
- The
RBI has maintained therepo rate at 6.50% for the past nine meetings.
The meeting, which began on October 7, has garnered significant attention, as the RBI has maintained the repo rate at 6.50% for the past nine meetings.
The repo rate has remained steady since the RBI adopted a cautious stance to balance inflation control and
Key factors that the MPC is weighing include persistent inflationary pressures, particularly in food prices, as well as global economic uncertainties.
According to data from the Ministry of Statistics & Programme Implementation, while All India Consumer Price Index (CPI) inflation moderated to 3.65% in August--within the RBI's target band of 2-6%.
Despite these challenges, the RBI has so far opted for a status quo on the repo rate, aiming to foster economic recovery after the pandemic.
However, today's announcement will be closely watched to see if the central bank shifts its stance, especially given the external pressures and uncertainties surrounding global markets.
Economists, however, have noted that the RBI will not make any changes in its policy stance before December.
"With the focus on taming headline inflation, the RBI is likely to hold the rates although the core inflation is within the limit. It is possible the RBI may shift to the neutral stand" said M Govind Rao, Member, of the Fourteenth Finance Commission and former Director, of the National Institute of Public Finance and Policy.
On September 18, the US Federal Reserve announced a steep 50 basis points interest cut in its review meeting. US Fed announced the rate cuts after holding interest rates steady for eight straight meetings.
"In this overarching macroeconomic setting of heightened geopolitical tensions, core inflation inching upwards, oil price volatility, and high food inflation, we anticipate a change in the RBI's policy stance from "withdrawal of accommodation" to "neutral" at its forthcoming MPC meeting on October 9, 2024. However, we do not see any rate action coming and the benchmark interest rates may not undergo any change" said Manoranjan Sharma, Chief Economist, Infomerics Ratings.
Earlier this month the central government appointed three new members to the monetary policy committee. The MPC comprises three members from the RBI and three external members appointed by the Central Government.
With inputs from ANI.
SEE ALSO:
BYD eMax 7 electric MPV launched in India starting at ₹26.9 lakh
Here’s how a Reddit user was able to get an iPhone 16 at under ₹27,000
Hyundai To Swiggy: Everyone wants to cash in on the IPO bonanza