RBI Monetary Policy: The Reserve Bank of India (RBI) Governor Shaktikanta Das on Thursday (August 8) announced the bi-monthly monetary policy statement, keeping the repo rate, which is the central bank’s rate for short-term loans to banks, unchanged at 6.5%.
The Governor also said inflation and growth are evolving in a balanced manner, though we need to remain vigilant on the food prices front.
Radhika Rao, senior economist, DBS Bank said, “Policy guidance reinforced that domestic considerations will be prioritised, despite a sharp buildup in rate cut pricing for the US Fed. The RBI MPC retained its cautious tone on inflation, in the face of an anticipated passthrough from perishables price pressures and tariff adjustments. With domestic demand conditions calling for a focus on inflation, we expect the policy rate to stay on hold for the rest of the year.”
Earlier in June, the RBI MPC voted 4-2 to maintain the repo rate at 6.5% for the eighth consecutive time and persist with its stance of ‘withdrawal of accommodation’. The RBI then revised its GDP growth forecast for FY25 to 7.2%, up from the previous estimate of 7% and the inflation forecast for FY25 remained unchanged at 4.5%.
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