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RBI Governor Shaktikanta Das. (File photo)
RBI Monetary Policy February 2024: RBI Monetary Policy Committee (MPC) meeting latest updates, RBI MPC meeting February 2024, Repo rate news and results
RBI Monetary Policy 2024: Reserve Bank of India Governor Shaktikanta Das will announce the two-month policy today (February 8) as inflation remains close to the upper tolerance level of 6 percent.
The Monetary Policy Committee (MPC) chaired by Governor Das began its three deliberations on Tuesday, February 6.
The MPC is charged with the responsibility of deciding the repo policy rate to achieve the inflation target while keeping in mind the growth target.
RBI Monetary Policy Timing
Das will announce the monetary policy at 10 am.
For a year, the Reserve Bank has kept its short-term lending rate, or repo rate, steady at 6.5 percent.
The benchmark interest rate was last raised in February 2023 from 6.25 percent to 6.5 percent, mainly to contain inflation driven by global developments.
In the current fiscal year, retail inflation eased after peaking at 7.44 percent in July 2023, which is still high and stood at 5.69 percent in December 2023, though within the Reserve Bank’s comfort zone of 4-6 percent.
A pause is expected
The State Bank of India (SBI) report said the RBI is expected to maintain a policy pause stance going forward.
“Strong US non-farm payrolls data and wages appear to have pushed back market expectations for a rate cut,” he said, adding that the first rate cut on the schedule between June and August was “the best ‘looks’ bet now’.
The sovereign lender also expects the RBI to continue to unwind its accommodative stance.
SBI also said that CPI is expected to be around 5.4 per cent in 2023-24 and 4.6 per cent to 4.8 per cent in the next financial year (2024-25).
Industry experts believe that the central bank will not touch the repo rate for the sixth time in a row, mainly due to concerns about inflation, which currently stands at 6.5 percent.
The government has instructed the central bank to keep consumer price index (CPI)-based retail inflation at 4 percent with a margin of 2 percent on either side.
The MPC raised the policy rate by 40 basis points at an off-season meeting in May 2022, followed by rate hikes of varying sizes at each of the five subsequent meetings through February 2023.
The repo rate was raised by a total of 250 basis points from May 2022 to February 2023.
Members of RBI MPC
The MPC consists of three external members and three officials from the RBI.
The external members of the panel are Shashanka Bhide, Ashima Goyal and Jayanth R Varma. Apart from Governor Das, the other RBI officials on the MPC are Rajiv Ranjan (Executive Director) and Michael Debabrata Patra (Deputy Governor).
(with inputs from PTI)