Repo Rate Hiked By 25 bps To 6.5%, Announces RBI Governor Shaktikanta Das

The Reserve Bank of India (RBI) Governor Shaktikanta Das has announced that the monetary policy committee (MPC) has decided on a majority to hike the repo rate by 25 basis points to 6.5 per cent.

New Delhi: The Reserve Bank of India (RBI) Governor Shaktikanta Das has announced that the monetary policy committee (MPC) has decided on a majority to hike the repo rate by 25 basis points to 6.5 per cent. The standing deposit facility (SDF) will stand revised to 6.25 per cent and marginal standing facility (MSF) will be revised to 6.75 per cent.

“Unprecedented events of the last three years have put to test monetary policy across the world. Emerging market economies are facing sharp tradeoffs between supporting economic activity and controlling inflation while preserving policy credibility. The global economic outlook doesn’t look as grim now as it did a few months ago, growth prospects in major economies have improved while inflation is on a descent though inflation still remains well-above the target in major economies”, RBI Governor Shaktikanta Das

Mr Das also added that the inflation is expected to average 5.6 per cent in the 4th quarter of 2023-24.

In its December monetary policy review meeting, RBI hiked the repo rate by 35 bps after delivering three successive hikes of 50 bps each. Following the disruption of the global supply network after the outbreak of Russia Ukraine war, India’s central bank began the bi-monthly monetary review meeting and policy changes. In this financial year, RBI first hiked the policy rate by 40 bps in May 2022, followed by three consecutive rate hikes to the tune of 50 bps each between June to October and 35 bps in the December meeting.