RBI Monetary Policy: MPC Holds Status Quo For Entire FY24, Repo Rate At 6.5%

Six-member MPC chaired by RBI governor Shaktikanta Das has decided to keep repo rate unchanged at 6.5% for the sixth time in a row. That being said, RBI makes no hike or cut in repo rate throughout financial year 2023-24. There was also no impact of interim budget on RBI's decision. Majority of economists had predicted a status quo on February 8, and rate cuts by the second half of 2024.

Accordingly, the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50%. While the standing deposit facility (SDF) rate remains unchanged at 6.25%, and the marginal standing facility (MSF) rate and the Bank Rate at 6.75%.

Further, five out of six MPC members voted to continue the policy stance. Hence, the MPC decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth.

These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2%, while supporting growth.