INSUBCONTINENT EXCLUSIVE:
For context, this key financial exercise impacts interest rate at which the central bank lends to commercial banks in India, which in turn
affects interest rates on certain loans | (Photo: Reuters)3 min read Last Updated : Aug 08 2024 | 7:01 AM IST
The Reserve Bank of India's
(RBI) Monetary Policy Committee (MPC) convened on Tuesday, August 6, for a three-day session to discuss its monetary policy decision
Shaktikanta Das on Thursday, August 8.
For context, this key financial exercise impacts the interest rate at which the central bank lends
to commercial banks in India, which in turn affects the interest rates on certain loans provided to customers, thereby regulating cash flow
this committee, including noted economists
The team has kept the repo rate unchanged at 6.5 per cent for the previous eight policy reviews since February 2023.
A Business Standard
poll earlier indicated that economic experts anticipate that the RBI will maintain this status quo for the ninth consecutive policy review
in 2016, is expected to meet at least four times a year
Their main target, as Das spoke during the last meeting, is to focus like 'Arjuna's eye' to meet the inflation goals.
In India, the Centre
has set an inflation target (gauged by the consumer price index) at 4 per cent (with an upper tolerance limit of 6 per cent and a lower
tolerance limit of 2 per cent)
To understand its importance, one must note that in June, retail inflation breached the five per cent mark to stand at a four-month high of
According to the central bank, this financial year is expected to deliver a decreased average retail inflation rate at 4.5 per cent compared
India remained the fastest growing economy globally in FY24 with real GDP growth at 8.2 per cent.
To be clear, in the May MPC meeting, two
members dissented from keeping the rate unchanged, fearing that not cutting it could weigh on growth given the rise in the cost of
