Maintaining the existing condition for the third time now, it charged over aloft hike, the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) has fort the repo rate untouched at 4 percent. The reverse repo rate will also resume taking home 3.35 percent for banks for their deposits to retain with the RBI. The RBI has also reckoned real Gross Domestic Product (GDP) growth for 2021 at minus 7.5 percent.
The central bank had braced the repo rate by 115 basis points since late March to prop up growth, the decision was taken by the RBI Governor Shaktikanta Das, “Monetary Policy Committee (MPC) elected with one accord to keep the policy repo rate constant at 4 percent.” He also added that the MPC has decided to keep going with the accommodative stance.
MPC marked to influence with competitive stands in terms of monetary policy as long as it would take at least the coming year running financial year and into coming year to bring round the growth on a long-lasting basis and to lower the knock of coronavirus while ensuring that inflation remains the same within the target,” Shaktikanta Das said.
Shaktikanta Das mentioned the RBI is ready to take further calculations to aid liquidity. “We will take up numerous tools at a fitting time to ensure sufficient liquidity is available in the system,” the RBI governor said.
Shaktikanta Das added that the central bank has pledged to maintain depositors’ interest in the financial system and carry on to add that “financial markets are working in an orderly fashion.”
The rate with the bank will remain the same at 4.25% “The Marginal Standing Facility (MSF) in terms of The reverse repo rate remains similar at 3.35 percent,” Shaktikanta Das said, adding, the inflation is likely to stay elevated.
Shaktikanta Das also mentioned that the economy is recovering faster with other more sectors joining the path to recovery. He also said the real Gross Domestic Product (GDP) growth for 2021 is projected at minus 7.5 percent.