Good news for borrowers: RBI maintains repo rate at 6.5%
The RBI’s decision to hold the repo rate at its current level was largely anticipated by economists and market experts, who have been closely monitoring the central bank’s moves in the wake of India’s economic growth.
RBI announced on Friday that it would be keeping the repo rate steady at 6.5 percent. This decision was made during the Monetary Policy Committee (MPC) meeting.
The Reserve Bank of India (RBI) announced today that it would be keeping the repo rate steady at 6.5 percent. This decision was made during the Monetary Policy Committee (MPC) meeting, where the committee evaluated various economic indicators and factors influencing the country’s financial landscape.
The RBI’s decision to hold the repo rate at its current level was largely anticipated by economists and market experts, who have been closely monitoring the central bank’s moves in the wake of India’s economic growth.
The decision to maintain the repo rate at 6.5 percent stems from several key factors:
Repo Rate & Inflationary Pressures
The RBI is closely monitoring inflationary pressures, which have been gradually subsiding in recent months. Keeping the repo rate steady is seen as a measure to ensure that inflation remains within the RBI’s target range of 4 percent.
Economic Stability
The Indian economy is currently on a growth trajectory. The RBI believes that maintaining a steady repo rate will provide stability and support to the economy as it navigates this crucial phase.
Global Economic Uncertainties
Due to the war between Russia and Ukraine, the global economic scenario remains uncertain, with various countries grappling with their own unique challenges. By keeping the repo rate unchanged, the apex bank aims to provide a measure of stability and predictability to the Indian financial markets.
Credit Growth and Investment
With the repo rate held steady, lending rates for consumers and businesses are expected to remain stable. This is anticipated to encourage credit growth and investment, essential components of economic recovery.
Fiscal Policy Measures
The government has taken several fiscal policy measures to stimulate economic growth, including various relief packages and infrastructure spending. The RBI’s decision complements these efforts and contributes to a coordinated approach towards economic revival.
Economists and financial analysts have welcomed the RBI’s decision to maintain the repo rate, viewing it as a prudent move given the current economic landscape.
With inflation gradually easing and growth prospects improving, keeping the repo rate unchanged is a well-considered move. It ensures that monetary policy remains accommodative without compromising on stability.
— ReserveBankOfIndia (@RBI) October 6, 2023
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