RBI leaves key interest rate unchanged
The Reserve Bank of India (RBI) left key rates unchanged even as it said that ‘calibrated tightening’ of policy would be maintained.
The key repo rate has been maintained at 6.5 per cent. RBI Governor Urjit Patel said the decision on cash reserve ratio (CRR), the cash that banks have to maintain with the central bank, was not within the ambit of the Monetary Policy Committee (MPC). This is for the second time in a row that the central bank did not tinker with the interest rate.
“The decision of the Monetary Policy Committee is consistent with the stance of calibrated tightening of monetary policy in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/-2 percent, while supporting growth,” RBI said in its comments post-policy announcement.
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LETTER FROM THE EDITOR: A SPECIAL THANKS TO OUR READERS