New Delhi: The Reserve Bank of India’s Monetary Policy Committee (MPC) will announce its by-monthly interest rate decision today. RBI Governor Shaktikanta Das will announce the decision at 10am about the RBI Monetary Policy for June 2024 after the second meeting of the RBI MPC in FY25. The Reserve Bank of India may keep the repo rate unchanged at 6.5% amid robust growth momentum as retail inflation hit an 11-month low in April 2024 at 4.83 per cent. The number has remained within RBI’s tolerance band of 2-6 per cent.
India’s economy grew at 8.4 percent, its fastest pace in 18 months, in the final three months of 2023 owing to strong manufacturing and construction activity. The government revised its growth estimate for 2024 to 7.6 per cent from 7.3 per cent.
Analysts said that it is highly improbable that the RBI will precede the US Fed in cutting policy rates as the interest rate differential between the US and India is at historic lows.
“The RBI has also been indicating that India’s monetary policy reaction function crucially depends on domestic conditions and US Fed may not have much of an impact. However, we think that RBI is unlikely to precede the Fed in this rate-cutting cycle as the interest rate differential between the two economies is at historic lows,” officials from the Yes Bank said.
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