The Monetary Policy Committee (MPC) of the Reserve Bank of India met from April 6 to 8, with the decisions announced by Governor Sanjay Malhotra on Wednesday, April 8. The central bank kept the repo rate unchanged at 5.25% amid the ongoing global economic crisis.
"The Monetary Policy Committee met on 6th, 7th and briefly today in the morning to deliberate and decide on the policy repo rate. After a detailed assessment of the evolving macroeconomic and financial developments and the outlook, the MPC voted unanimously to keep the policy repo rate unchanged under the liquidity facility at 5.25%. Consequently, the STF rate remains at 5% and the MSF rate and the bank rate at 5.5%. The MPC also decided to continue with the neutral strands," said Sanjay Malhotra.
With no change in the key policy rate, borrowers will have to wait longer for any reduction in EMIs. This was the first MPC meeting of the new financial year. The RBI had also maintained status quo in the previous meeting, continuing its wait-and-watch approach.
What Did Experts Say?
State Bank of India Chief Economist Soumya Kanti Ghosh said the RBI is likely to maintain a cautious stance. She noted that India is facing global pressures, with the rupee crossing 93 against the US dollar and crude oil prices rising above $100 per barrel.
These factors could increase import-driven inflation. Additionally, concerns over a potential ‘Super El Niño’ may impact the monsoon and push up food prices. This could force the RBI to tighten its policy stance further, she cautioned.