RBI keeps repo rate unchanged: 'To wait for impact of policy actions'
&imwidth=600&imheight=450&format=webp&quality=medium "RBI keeps repo rate unchanged: 'To wait for impact of policy actions'")
RBI Governor Sanjay Malhotra Photograph: (ANI file)
RBI Governor Sanjay Malhotra said that the panel decided to retain its stance as "neutral".
The Reserve Bank of India’s Monetary Policy Committee (MPC) on Wednesday kept the repo rate unchanged at 5.5 per cent. RBI Governor Sanjay Malhotra stated that the panel deemed it prudent to wait until the impact of certain policy actions is visible.
"The Monetary Police Committee (MPC) considered it prudent to wait for the impact of policy actions to play out and for greater clarity to emerge before starting the next course of action. Accordingly, the MPC unanimously voted to keep the policy repo rate unchanged at 5.5% and also decided to retain the stance as neutral," he said.
"Consequently, the STF rate remains at 5.25%, while the MSF rate and the bank rate remain at 5.75%. The MPC also decided to continue with the neutral stance," he added.
The RBI Governor further said that the inflation figures were revised.
"The average headline inflation for this year has consequently been revised, lowered from 3.7 % which was projected in June, 3.1 % in August, to 2.6%. Headline inflation for Q4 this year and Q1 next year too has been revised downwards and is broadly aligned with the target despite unfavourable base effects. Core inflation for the year and Q1 next year is also expected to remain contained," he said.
He said that global uncertainties and tariff-related developments are likely to decelerate growth.
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"The current macroeconomic conditions and the outlook have opened up policy space for further supporting growth... The trade-related uncertainties are also unfolding," he added.
RBI Governor Sanjay Malhotra said that the structural GST reforms announced by Prime Minister Narendra Modi will help India offset some of the adverse effects of global headwinds.
"Taking all these factors into account, real GDP growth for this year is now projected at 6.8 per cent. This is a revision from our earlier forecast of 6.5%; now it is projected at 7%, Q3 at 6.4%, and Q4 at 6.2%. Real GDP growth for Q1 next year is projected at 6.4%. The risks are evenly balanced," he added.