RBI holds repo rate steady at 6.5%

The Reserve Bank of India (RBI) decided on Friday to keep the policy rate unchanged for the eighth consecutive time, maintaining a close watch on inflation.

 

The central bank paused its rate increase cycle in April last year after six successive hikes, totaling 250 basis points since May 2022.

 

RBI Governor Shaktikanta Das announced the second bi-monthly monetary policy for the current financial year, stating that the Monetary Policy Committee (MPC) has opted to keep the repo rate steady at 6.5 percent.

 

Das emphasized that the MPC will remain vigilant regarding elevated food inflation, with the expectation of a normal monsoon.

 

The RBI also revised its growth projection upwards to 7.2 percent from the previous estimate of 7 percent for the current financial year.

 

The government has tasked the RBI with ensuring CPI inflation remains at 4 percent, with a margin of 2 percent on either side.