RBI MPC Meeting: RBI did not make any change in key interest rates in the MPC meeting held in April. At present, the repo rate remains at 4 percent and the reverse repo rate at 3.35 percent.
Reserve Bank of India
RBI MPC Meeting: The three-day meeting of the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) began today. It is expected that policy rates may remain intact due to the uncertainty created due to the outbreak of the second wave of the COVID-19 pandemic. There is little hope of any change in interest rates from the MPC due to fears of a pick-up in inflation.
The results of this monetary policy review, to be held every two months, will be announced on June 4 i.e. Friday. RBI did not make any change in key interest rates in the last MPC meeting held in April. At present, the repo rate is at 4 percent and the reverse repo rate is at 3.35 percent.
Some relief on the growth front
M Govinda Rao, Chief Economic Adviser, Brickwork Ratings, has said that the better-than-expected GDP figures have given some relief to the MPC on the growth front. However, the downside risks to growth have intensified due to restrictions such as partial lockdowns imposed in many parts of the country, he said. In such a situation, it is likely that the RBI will continue with its accommodative monetary policy stance and keep the repo rate at 4 per cent with a cautious approach.
Central bank may maintain liberal stance
Dhruv Aggarwal, Group CEO, Housing.com, Makaan.com and PropTiger, believes that the RBI can maintain its accommodative stance without jeopardizing its main objective of controlling inflation.
He said that reviving growth has become an important objective due to the economic loss caused by the recent lockdown. RBI should also consider providing more liquidity to National Housing Bank to bring stability to housing finance companies, which will lead to expansion of the real estate sector.
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