No surprising announcements; RBI keeps repo rate unchanged at 6.5 percent

MUMBAI: The Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) has decided to keep the policy repo rate unchanged at 6.5 per cent as retail inflation continues to be above its target of 4 per cent.

This is the seventh consecutive meeting that the MPC has maintained a status quo on the repo rate. The repo rate, is the interest rate at which banks draw funds from RBI to overcome short-term liquidity mismatches.

This is the first monetary policy statement of the current financial year 2024-25, said RBI Governor Shaktikanta Das.

"It was decided by a majority of 5:1 to keep the interest rate unchanged at 6.50 per cent. Consequently the Standing Deposit Facility, the SDF rate remains at 6.25 per cent. Marginal Standing Facility (MSF) rate and the bank remain at 6.75 per cent," said Das.

The MPC had maintained the status quo on policy rates and stance in its last review which was held in February 2024. RBI has also maintained the stance of 'withdrawal of accommodation'