RBI keeps repo rate unchanged;  repo rate will remain at 6.5 percent

MUMBAI: The Monetary Policy Committee of the Reserve Bank of India (RBI) in its December review meeting unanimously decided to keep the policy repo rate unchanged at 6.5 per cent, thus maintaining the status quo for the fifth straight time.

Deliberating the policy statement on Friday morning, RBI Governor Shaktikanta Das attributed declining inflation as the reason behind maintaining the status quo of the policy stance.

Retail inflation in India continued to ease through October, supported by a relative decline in some of the sub-indexes. The October consumer price index (CPI) came at a four-month low of 4.87 per cent against 5.02 per cent the previous month. Retail inflation in India though, is in RBI's 2-6 per cent comfort level but is above the ideal 4 per cent scenario.

Das said the MPC also decided by a majority of 5 out of 6 members to remain focused on the withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth. Das' remarks also found mention of firm GDP growth in the second quarter.

The Indian economy grew 7.6 per cent during the July-September quarter of the current financial year 2023-24, remaining the fastest-growing major economy. India's GDP growth for the April-June quarter grew 7.8 per cent.