MUMBAI - The Reserve Bank of India (RBI) has maintained its repo rate at 6.5% for the fifth consecutive time today, signaling a steady approach to monetary policy amid persistent inflation concerns. The decision, taken by the RBI's Monetary Policy Committee (MPC), comes alongside an upward revision of India's GDP growth forecast to 7%, marking a positive outlook based on strong recent economic data.
This optimistic projection for the fiscal year 2024 surpasses earlier estimates by international agencies and reflects robust growth figures from the July-September period, as well as promising quarterly growth rates that could reach up to 6.7%.
Governor Shaktikanta Das has made it clear that there will be no near-term easing of monetary policy, given that retail inflation remains above target levels. The governor stressed that containing inflation is a priority and indicated that the RBI is not shifting towards a neutral stance at this time. No forward-looking statements were provided regarding potential changes to policy rates due to uncertainties in the global economic environment.
Deputy Governor Michael Patra pointed to exceeding GDP forecasts and strong recent data trends as justification for the upgraded growth estimate. Positive indicators include increased two-wheeler sales in rural markets during festive periods, sustained demand for fast-moving consumer goods (FMCG) since April, and a notable decline in applications for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS) in November.
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