RBI Keeps Repo Rate Unchanged At 6.50%, Governor Says, 'Need To Remain Vigilant In Uncertain Times'

RBI Keeps Repo Rate Unchanged At 6.50%, Governor Says, 'Need To Remain Vigilant In Uncertain Times'

The MPC came to this decision with a 4-2 majority of the committee. The rate has remained at 6.50 per cent since February 2023.

Juviraj AnchilUpdated: Friday, June 07, 2024, 10:15 AM IST
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The Reserve Bank of India has once again retained its repo rate to 6.5 per cent, retaining the status quo. The central bank has resorted to sustaining the same rate for the eighth straight time. This was announced by the government's banker after a three-day Monetary Policy Committee meeting on June 7.

RBI Maintains Repo Rate 6.50%

The governor, in his address, started by addressing the need for economic paradigms to remain vigilant in an uncertain global environment. Her also emphasised on food inflation

The MPC came to this decision with a 4-2 majority of the committee. The rate has remained at 6.50 per cent since February 2023.

This MPC meeting started on June 5 and will conclude on June 7. These MPC meetings, under the leadership of the RBI governor (currently Shaktikanta Das), ruminate and decide upon the monetary policies for the country every two months. The next MPC is scheduled to happen in August, between August 6 and 8, 2024.

A repo rate, in basic terms, is the rate at which the central bank gives pecuniary resources to commercial banks.

A repo rate would automatically mean a higher interest rate on your loans, thereby curbing your ability to take up money, reducing the flow of money in the market and the economy at large.

The RBI governor is expected to hold a post-meeting presence press conference later on June 7 at around 12:00 IST.

The RBI governor is expected to hold a post-meeting presence press conference later on June 7 at around 12:00 IST. | File/ Representative

Rating Agencies Expect a Cut in Rate

It is to be noted that the new government and its finance minister are expected to present their full budget for the fiscal year 2024–25 in June. The interim budget, before the announcement of the model code of conduct, for the Lok Sabha elections in February.

The RBI governor is expected to hold a post-meeting presence press conference later on June 7 at around 12:00 IST.

It is interesting to note that many rating agencies, primarily American entities including Moody's, Fitch and S&P, along with investment banks like Goldman Sachs and JP Morgan upgraded their ratings and forecasts for the country recently, and one of the elements that they relied on to do so was the interest rate or repo rate.

These entities underlined the importance and their expectations of the central bank slashing the repo rate.

The US Federal Reserve has also retained its interest rate between 5.25-5.50 per cent for some time now.

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