The Reserve Bank of India raised the repo rate by 25 basis points to 6.5% on Wednesday. Governor Shaktikanta Das announced the decision of the monetary policy committee, which was approved by a vote of 4 out of 6 members. This was the year’s first Monetary Policy Statement. The repo rate was hiked by 0.35 percentage points to 6.25% in December 2022. The reverse repo rate of 3.35% remained unchanged.
The standing deposit facility rate will be reduced to 6.25%, while the marginal standing facility rate and the bank rate will be increased to 6.75%. The MPC also resolved, by a vote of 4 to 6, to keep the focus on the withdrawal of accommodation in order to keep inflation within target while boosting growth.
Das believes that the global economic situation is not as bleak as it was a few months ago. In major economies, inflation continues considerably over the objective. Das stated that the situation is still fluid and unpredictable.
The Indian economy is resilient, according to RBI Governor Shaktikanta Das, who added that real GDP growth is expected to be 7% in 2023-23.