RBI move on Repo Rate: The Reserve Bank of India may once again keep the repo rate at 6.5 percent on Thursday. Experts believe that the RBI may wait for more macroeconomic data before cutting interest rates. Let us tell you that the US Federal Reserve has also decided not to make any change in its interest rate. The Fed has also indicated that monetary policy may be relaxed in the coming months.
No chance of cutting interest rates
Experts said that the Reserve Bank will keep a close eye on the US monetary policy before changing its stance on interest rates amid continued inflationary pressure. The Monetary Policy Committee (MPC) may also refrain from cutting rates, as the interest rate (repo rate) has certainly been increased to 6.5 percent and economic growth is good.
RBI MPC meeting will run from 6 to 8 August
Let us tell you that the MPC meeting chaired by Reserve Bank of India Governor Shaktikanta Das is to be held from 6 to 8 August. After the meeting is over, the RBI Governor will announce the committee’s decision on August 8.
Inflation rate at high level of 5.1 percent is the major reason
Bank of Baroda Chief Economist Madan Sabnavis said, “We expect the RBI to keep the repo rate unchanged. Inflation remains high at 5.1 per cent today and will come down numerically in the coming months, but it will remain high due to the base effect.”
ICRA Chief Economist Aditi Nair said that high growth in FY2023-24, coupled with inflation of 4.9 per cent in the first quarter of the current financial year, looks in favour of maintaining the status quo. She said that there seems to be no scope for a cut in interest rates in the August 2024 meeting.
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