The Reserve Bank of India (RBI) has decided to keep the key repo rate unchanged at 6.5% as its focus remains on bringing inflation under control.
RBI Governor Shaktikanta Das said the MPC voted in favour of keeping the key lending rates unchanged.
“After a detailed assessment of the evolving macroeconomic and financial developments and the outlook, the Reserve Bank MPC decided by a majority of 5 to 1 to keep the policy repo rate unchanged at 6.50%," Das said.
The decision was largely in line with what economists had predicted.
He also highlighted the need for the monetary policy to maintain an actively disinflationary stance at this stage.
"Further, the higher US yields, higher oil prices and other commodities along with possible delay in Fed's rate easing cycle will keep the MPC wary. Accordingly, we do not see much scope for any rate easing until the second quarter of FY25," Bhardwaj added.
"Going ahead, we remain optimistic that the RBI will contemplate rate cuts and build shallow rate cut cycle from June onwards to support lower interest rates and credit demand. Overall, we believe that investor sentiment will continue to remain bullish, supported by the market's persistent strength," Saxena added.
