The Reserve Bank of India (RBI) can maintain policy rates for the third consecutive time in the December monetary review. Experts have expressed this opinion. Experts said that due to the increase in the rate of retail inflation, the Monetary Policy Committee (MPC) probably will not change interest rates once again. Retail inflation currently remains above the Reserve Bank’s satisfactory level.
However, the growth rate of gross domestic product (GDP) in the second quarter of the current fiscal year ended in September has been negative, due to which the central bank may keep its monetary stance soft. Beyond this, interest rates can be cut if needed. The two-day meeting of the six-member Monetary Policy Committee headed by Reserve Bank Governor Shaktikanta Das will begin from December 2. The results of the meeting will be announced on December 4.
Policy rates were not changed in the last meeting of the MPC in October. The reason for this is the increase in inflation, which has crossed the six per cent level in recent times. The Reserve Bank estimates that the country’s economy will decline by 9.5 per cent in the current financial year. Since February this year, the central bank has cut the repo rate by 1.15 percent.
