The Reserve Bank of India on Friday decided to keep the policy rate unchanged for the 11th time in a row but sharply lowered the GDP growth forecast to 6.6 per cent for the current fis🐽cal, as against earlier projection of 7.2 per cent.
The Reser🔴ve Bank of India (RBI) maintained the status quo on interest rate despite July-September quarter GDP growth falling to 7-quarter low of 5.4 per cent, as against its own projection of 7 per cent.
The rate increase cycle was paused༒ in April last year after six con♏secutive rate hikes, aggregating to 250 basis points since May 2022.
Announcing the fifth bi-monthly monetary policy for the current financial year, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged at 6.5 per cent while keeping policy st✤ance unchanged at neutral.
He said MPC will remain wa♐tchful of incoming macroeconomic data for future a𒉰ction.
The RBI sharply cut the GDP growth projection to 6.6 per cent from the e♍arlier level of 7.2 per cent, while raising inflation target to 4.8 per cent from the previous projection of 4.5 per cent for the current fiscal.
In a bid to make available more🎀 money with banks for lending so as to boost economic activity, the RBI slashed Cash Reserve Ratio to 4 per cent from existing 4.5 per cent. This would lead to release of Rs 1.16 lakh crore to banks a♐nd improve their lending capacity.
The CRR is the percentage of a bank’s total deposits that it is required to maintain in liquid cash with the RBI. The CRR percentage is determined by t𓄧he RBI from time to time. Banks do not get any ﷽interest on this amount.
The government in October reconstituted the Reserve Bank's rate-setting panel -- Monetary Policy Committee (MPC). This was the second MPC meeting of the reconstituted pan🃏el with three newly appointed external members -- Ram Singh, Saugata Bhattacharya and Nagesh Kumar.
