Reserve Bank’s Monetary Review Meeting: There is a possibility of a further increase of 0.50 percent in the repo rate to rein in high inflation. The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) will begin its three-day meeting today, which is the cause of this anxiety.
The RBI may also increase the repo rate in line with the increase in interest rates by other major central banks, including the US central bank Fed Reserve. Based on the recommendations of the MPC, the RBI increased the repo rate by 0.50 percent in June and August. Earlier in May, the central bank had increased the interest rate by 0.40 percent in its sudden meeting.
New rates will be released on 30 September
The meeting of the MPC under the chairmanship of Reserve Bank Governor Shaktikanta Das will run from today till September 30. The decision on rates will be taken on Friday i.e. 30 September. Experts predict that the central bank will likely raise the key policy rate repo by 0.50 percent once again, bringing it to a three-year high of 5.9 percent. At present, it is 5.4%. Since May, the RBI has raised the repo rate by 1.40 percent. In a study, the Bank of Baroda stated that monetary policy will be watched more closely this time around due to recent changes in the foreign exchange market following the Federal Reserve’s rate hike last week.
There may be an increase of 0.50 percent
According to the report, the RBI may raise the repo rate by 0.50 percent once again at the upcoming MPC meeting. Significantly, the government has given a target to RBI to keep the retail inflation rate at 4 percent with a difference of two percent.
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