There was no change in the repo rate during the sixth economy meeting of the current fiscal year, chaired by RBI Governor Shaktikant Das. It is reported that the repo rate will continue to be 5.15%. The Reserve Bank of India (RBI) has stated that the inflation rate has not decreased.
India’s growth forecast for the fiscal year 2020-21 is 6%. In the first half of the fiscal year 2020-21, growth is projected to increase from 5.5 to 6.0 percent and in the third quarter to 2.2 percent. At a monetary policy meeting last December, growth for the current fiscal year was forecast to be a percentage point. At the current meeting, the company said it will grow at a percentage point in the current fiscal year.
The retro repo rate has also not changed. The reverse repo is expected to touch 4.90% as per the previous measure.
It is customary for the RBI to hold a monetary policy meeting every two months. It includes interest rate and revenue policy decisions. The sixth economy meeting of the current fiscal year, headed by Reserve Bank Governor Shakti Kantha Das, began on Tuesday. The results were released yesterday.
Consumer inflation for the fourth quarter of the current fiscal year is forecast to be .5 decimal percent. In the first half of the current fiscal, inflation has been predicted to be 5.7 percent and 3 percent in the third quarter.
Inflation is rising
RBI says inflation was higher than expected. Food inflation rose by 1.3 percent in December. It has been reported that the Re Po rate has not been reduced to reduce inflation. Banks have not already implemented repo reduction; It has been said that the benefits of reducing repos are not good for the people. At this point, interest rates must go to the center, “said Dakshin Das.
In the recently announced budget, the central government increased the deposit insurance coverage from Rs 1 lakh to Rs 5 lakh. He said the financial position of the central government will not be affected.
The repo rate was reduced by 25 basis points during the fiscal monetary policy meeting held in February, April and June 2019. This was followed by a 35 basis point decrease in the August meeting and a 25 basis point decrease in October. However, the repo rate did not decrease during December’s monetary policy meeting. All in all, it dropped 135 basis points last year. It is noteworthy that this fiscal year is the last fiscal year policy meeting.