October 6, 2023
The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) decided to keep the repo rate unchanged at 6.50% at its meeting on October 5, 2023. This is the fourth consecutive meeting in which the MPC has maintained the status quo on the repo rate.
The MPC’s decision to keep rates unchanged comes against the backdrop of rising inflation and global economic uncertainty. However, the MPC noted that inflation had started to ease in recent months, and that the Indian economy was showing signs of resilience.
In his statement, RBI Governor Shaktikanta Das said that the MPC was “resolutely focussed on the 4% inflation target in the interest of sustainable growth”. He added that the MPC would remain watchful and evaluate the evolving situation.
The decision to keep rates unchanged is likely to be welcomed by the Indian business community, which has been calling for monetary policy support to boost economic growth. However, some economists have warned that the RBI may need to raise rates in the future if inflation remains high.
The repo rate is the rate at which the RBI lends money to commercial banks. It is a key benchmark interest rate that influences the cost of borrowing for businesses and consumers.
