RBI keeps repo rate unchanged at 6.5% for eighth time in a row

Mumbai: The Reserve Bank of India (RBI) Governor Shaktikanta Das on Friday announced the monetary policy committee's decision to keep repo rate unchanged at 6.50%.

It is the eighth consecutive time in a row that the RBI has kept the policy rate unchanged at 6.50%.

The repo rate is the rate at which RBI lends money to banks.

The rate increase cycle was paused in April last year after six consecutive rate hikes aggregating to 250 basis points since May 2022.

Announcing the second bi-monthly monetary policy for the current financial year, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged at 6.5%.

He said MPC will remain watchful of elevated food inflation amid the expectation of a normal monsoon.

The RBI raised the growth projection to 7.2% from an earlier estimate of 7% for the current financial year.

Furthermore, RBI projects retail inflation in Q1 of FY25 at 4.9%, Q2 at 3.8%, Q3 at 4.6%, and Q4 at 4.5%.

Inflation growth balance moving favourably, and the second quarter of the current fiscal likely to see some correction in retail inflation says RBI Governor Das after a monetary policy committee meeting.

RBI remains committed to aligning inflation to 4% on a durable basis, says Governor Das.