The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) kept the repo rate unchanged at 6.5 percent for the ninth straight meeting, with a majority of 4-2.
The MPC decided to keep its stance of "withdrawal of accommodation" unchanged. Four out of six MPC members voted in favour of the rate decision. Keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50 percent.
Consequently, the standing deposit facility (SDF) rate remains unchanged at 6.25 percent and the marginal standing facility (MSF) rate and the Bank Rate at 6.75 percent.
The MPC also decided to remain focused on the withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth.
These decisions align to achieve the medium-term target for consumer price index (CPI) inflation of 4 percent within a band of /- 2 percent while supporting growth. The MPC last changed rates in February 2023, when the policy rate was raised to 6.50 percent. The annual retail inflation rate rose for the first time in five months in June, climbing above 5 percent on the back of a jump in food prices.
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