Monetary Policy: RBI leaves
key rates unchanged
FEB 2:
As was
widely expected, Reserve Bank of India Governor Raghuram Rajan on Tuesday chose
to keep the policy repo rate unchanged on inflation concerns even as it
emphasised that it continues to be accommodative.
The policy
repo rate (the interest rate at which the RBI provides liquidity to banks to
tide over short-term liquidity mismatches) is currently at 6.75 per cent.
While
inflation has evolved closely along the trajectory set by the monetary policy
stance and the January 2016 target of 6 per cent should be met, the RBI said
going forward, under the assumption of a normal monsoon and the current level
of international crude oil prices and exchange rates, inflation is expected to
be inertial and be around 5 per cent by the end of fiscal 2016-17.
Fast facts
Repo rate
unchanged at 6.75%
CRR
unchanged at 4%
Bank Rate,
MSF rate unchanged at 7.75%
Forecasts
growth to strenghten gradually in FY17...GVA growth rate at 7.6%
RBI says
January target of 6% CPI inflation "should be met"
Forecast
inflation rate around 5% by end of FY17
Keeps GVA
growth rate of 7.4% in FY16 with downward bias
Budget
will create more room for RBI in terms of monetary policy
