Mumbai : The Monetary policy committee (MPC) of RBI has decided to keep repo rate unchanged at 6.5%. Subsequently, the Standing Deposit facility rate has remained unchanged at 6.25%. Also Marginal Standing facility rate and Bank Rate has remained unchanged at 6.75%.
“On the basis of an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting today (June 8, 2023) decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50 per cent. The standing deposit facility (SDF) rate remains unchanged at 6.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 6.75 per cent. The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth. These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth” RBI governor Shaktikanta Das said.
GDP predictions by the central bank for Q1 and Q2 are increased while for Q3 & Q4, estimates are are reduced. Overall for FY24, growth estimate is maintained at 6.50%
CPI Inflation projected at 5.1 % in 2023-24 financial year. “Indian economy & financial sector stand out as strong & resilient, and domestic macro-economic fundamentals are strengthening. Rural demand is on a revival path” he said.
All members of the MPC – Dr. Shashanka Bhide, Dr. Ashima Goyal, Prof. Jayanth R. Varma, Dr. Rajiv Ranjan, Dr. Michael Debabrata Patra and Shri Shaktikanta Das – unanimously voted to keep the policy repo rate unchanged at 6.50 per cent. 12. Dr. Shashanka Bhide, Dr. Ashima Goyal, Dr. Rajiv Ranjan, Dr. Michael Debabrata Patra and Shri Shaktikanta Das voted to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth. Prof. Jayanth R. Varma expressed reservations on this part of the resolution.