Reserve Bank of India (RBI) The monetary policy meeting is underway. RBI governor Shaktikanta Das will announce the decision of this three-day meeting on Friday. People have been waiting for a long time for the EMI of their loans to be reduced. In such a situation, will the loan takers get relief this time or will they have to wait longer? Experts say that there is no possibility of a cut in the repo rate this time as well. Banking experts say that there is no possibility of a change in the repo rate and other policy rates in the three-day monetary policy review meeting of RBI ending on Friday because the central bank is trying to maintain a balance between economic growth and inflation.
The MPC meeting started on Wednesday
The meeting of the RBI’s Monetary Policy Committee (MPC) started on Wednesday and will end on Friday. In this, decisions will be taken on policy rates based on the country’s economic situation, inflation, monsoon situation, global factors etc. It is likely that the committee may decide to keep the repo rate stable at 6.5 percent. The repo rate is the rate at which the central bank lends short-term money to commercial banks so that they can meet their immediate liquidity needs. It affects the interest rates on loans given by banks to corporate and general customers. Reduction in interest rates reduces investment and consumption costs, however, there is a risk of inflation (price hike) due to increased consumption.
RBI’s emphasis on controlling inflation
RBI Governor Shaktikanta Das has said that the central bank will continue the policy of reducing inflation so that economic growth remains stable. He said that inflationary pressure remains due to high inflation rate of food items. RBI last changed the policy rates in February 2023. It had increased the repo rate by a total of 2.5 percent between May 2022 and February 2023. The repo rate has remained stable at 6.5 percent since February 2023.
Retail inflation still above target
The retail inflation rate had come down to 4.83 percent in April this year. However, it is still above the RBI’s medium-term target of four percent. The country’s economic growth rate increased to 8.2 percent in the financial year 2023-24. Due to this, RBI still has the option to postpone the reduction in interest rates.
Input: IANS
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