RBI Monetary Policy: The Reserve Bank of India (RBI) on Thursday cut repo rate by 25 bps to 6.25 per cent in its sixth bi-monthly monetary policy statement for 2018-19.
RBI Monetary Policy: The Reserve Bank of India (RBI) on Thursday cut repo rate by 25 bps to 6.25 per cent in its sixth bi-monthly monetary policy statement for 2018-19. The Monetary Policy Committee (MPC) has also unanimously voted to change the policy stance to ‘neutral’.
“On the basis of an assessment of the current and evolving macroeconomic situation at its meeting today, the Monetary Policy Committee (MPC) decided to: • reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 6.5 per cent to 6.25 per cent with immediate effect,” RBI said in a statement.
The reverse repo rate under the LAF stands adjusted to 6.0 per cent, and the marginal standing facility (MSF) rate and the Bank Rate to 6.5 per cent. The MPC also decided to change the monetary policy stance from calibrated tightening to neutral.
Monetary policy committee voteed 4:2 in favour of rate cut and was unanimous on change in stance. The RBI also revised down headline inflation estimates to 2.8 per cent in March quarter, 3.2-3.4 per cent in first half of next fiscal and 3.9 per cent in Q3 of FY20.
In its last bi-monthly monetary policy, the bank had kept the repo rate unchanged at 6.5 percent and the reverse repo rate at 6.25 percent.
The three-day policy review meeting by the Monetary Policy Committee (MPC) began in Mumbai on Tuesday. The MPC is headed by RBI Governor Shaktikanta Das.