RBI monetary policy: Repo rate unchanged at 4%

Reserve Bank of India’s monetary policy committee today voted to keep the policy rate unchanged at 4%. In its first post-spending meet, the MPC chose to keep up business as usual. RBI Governor Shaktikanta Das said that the standardization is get pace in India as fears of a second wave of the Covid-19 decrease.

Das further added that the Indian economy is expected to be back this year from the harm done by the pandemic. The move acquires significance this time as recently the central government unveiled its huge borrowing plan. Most financial experts had anticipated that the MPC should keep holding the repurchase rate at 4%. The 10-year security yield has gone up from 5.93% every day in front of the Union Budget to 6.08% yesterday.

The MPC cut interest rates by 115 basis points a year ago to maintain liquidity in the financial framework however has maintained for the last three meetings.