The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) on Thursday decided to keep the repo rate unchanged at 6.5 per cent for the ninth consecutive policy review, with a majority vote of 4-2. The RBI MPC also maintained its stance of “withdrawal of accommodation.”
The growth forecast for the current financial year remains unchanged at 7.2 per cent. However, the forecast for the first quarter was revised to 7.1 per cent from the earlier projection of 7.3 per cent. The rate-setting panel had previously revised the growth forecast in the last meeting to 7.2 per cent from 7 per cent. The growth for the first quarter of the next financial year is projected at 7.2 per cent.
The domestic rate-setting panel has projected inflation at 4.5 per cent for the current financial year, the same as the previous projection. On a quarterly basis, the inflation forecast was revised to 4.4 per cent for Q2, 4.7 per cent for Q3, and 4.3 per cent for Q4, against the previous projections of 3.8 per cent for Q2, 4.6 per cent for Q3, and 4.5 per cent for Q4. Inflation for the first quarter of the next financial year is projected at 4.4 per cent.
The Governor highlighted that food inflation, which has a weight of 46 per cent in headline inflation, cannot be ignored. He noted that high food prices likely persisted in July, leading to the revision in the inflation forecast for the second quarter of the current financial year.
First Published: Aug 08 2024 | 10:43 AM IST