The RBI Monetary Policy Committe will announce its decision on intererest rates in a short while from now. While the analysts and experts are almost unanimous in their expectation of a rate cut and further easing, this is RBI MPC meet that would have many firsts. Here is a quick look at all the key points to watch-
1. First Policy by newly appointed Governor Sanjay Malhotra
This is the first Policy under the newly appointed RBI Governor Sanjay Malhotra. He took charge as the 26th Governor of RBI on December 9, 2024. He succeeds Shaktikanta Das and is the 15th civil servant to take this responsibility. He was earlier, India’s Revenue Secretary. All eyes would be there on his commentary, body language and approach. He has the reputation of being a businessman-bureaucrat and after the reforms he had undertaken in his earlier post, all eyes are what he does next for the BFSI sector.
2. Probability of a rate cut for first time in 5 years
Almost every expert has hinted at the possibility of a rate cut. If the rBI indeed cuts rates, this will be the first rate action in 5 years. The last time, Reserve Bank of India tinkered with rates was in 2020 when the country was battling Covid. Bond price, too have rallied in recent weeks in anticipation of a possible 25 bps cut in rates.
3. Rajeshwar Rao heads Monetary Policy Committee
RBI Deputy Governor, Rajeshwar Rao is in charge of the monetary policy committee till a replacement for Michael Patra is announced. Patra completed his 5-year term as deputy Governor on January 15.