The Reserve Bank of India (RBI) on Friday kept key repo rate unchanged at 4% in its October policy review meeting in view of rising inflation and faint signs of economic growth amid gradual lifting of countrywide lockdown.
The six-member Monetary Policy Committee (MPC), headed by RBI governor Shaktikanta Das, kept repo rate untouched; and reverse repo rate at 3.35% while maintaining accommodative stance.
The central bank’s newly-constituted monetary policy committee (MPC) began its three-day meeting on October 7.
“The deep contraction of quarter one is behind us, the silver lining in visible,” said RBI Governor Shaktikanta Das while announcing the policy decisions of the MPC. “The mood of the nation has shifted from fear to hope,” he said.
What is repo rate?
Repo is the rate at which RBI lends funds to commercial banks when needed. It is a tool that the central bank uses to control inflation.
“The MPC voted unanimously to leave the policy repo rate unchanged at 4% and continue with the accommodative stance of monetary policy as long as necessary to revive growth, mitigate the impact of Covid-19 while ensuring that inflation remains within the target going forward,” said Das.
