Lawstreet Journal

Reserve Bank of India revises Monetary Policy Committee, Repo Rate remains Unchanged

Lawstreet Journal 12 Oct 2020 7:17pm

Image courtesy: Lawstreet Journal Executive Reserve Bank of India revises Monetary Policy Committee, Repo Rate remains Unchanged

The Reserve Bank of India revised the Monetary Policy Committee. The repo rate for the month of October remains unchanged. There is no change in time as well; the current repo rate is 4 %. The reverse repo rate has been maintained at 3.35 %. Repo rate is the rate at which the central bank of the country (Reserve Bank of India) lends money to commercial banks in the event of any shortfall of funds. Repo Rate is used by monetary authorities to control inflation. 

The Monitory Policy Committee voted unanimously to keep the policy rate unchanged. The central bank’s policy is maintained and called 'accommodative' which could continue as long as necessary to revive growth. Governor of Reserve Bank of India Shaktikant Das said that the GDP estimate for Financial Year 2021 the number is likely to contract by 9.5% in the year. He said that “Global economic activity has rebounded in Quarter 2 but unevenly among countries".

Shaktikant Das said that inflation will ease closer to target by Quarter 4 Financial Year 21. Since March 2020 levels have remained elevated and will remain elevated in September as well. He said that the “Monetary Policy Committee has decided to look through the current inflation as a transient hump".

Highlights of the Reserve Bank of India’s policy on development and regulatory policies:- 

  1. On Targeted Long Term Repo Operations: Reserve Bank of India proposes a tap on Targeted Long Term Repo Operations with the tenor of up to 3 years. Reserve Bank of India will target the specific sector that… Continue Reading...

    Tagged: Reserve Bank of India  
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