RBI Repo Rate : The Reserve Bank today published the decisions made at the Monetary Policy Committee’s (MPC) bi-monthly review conference on Friday. Shaktikanta Das, Governor of the Reserve Bank, stated that there was no change in the repo rate. This meeting kicked off on Wednesday. Experts had already predicted that the Reserve Bank will hold the repo rate steady.
The MPC voted to keep the repo rate at 6.5% by a vote of 4-2. The Reserve Bank is not modifying the repo rate for the eleventh time in succession. The SDF and MSF rates remain stable at 6.25% and 6.75%, respective.
What will be the impact of no change in the RBI Repo Rate ?
People will not be relieved of their high-interest debts if the repo rate remains unchanged. If the repo rate was low, banks would lend to people at a cheaper interest rate. In terms of inflation, the Reserve Bank was expected to lower the repo rate this time around.
Reduction in CRR
The conference also saw an action on the cash reserve ratio (CRR). It has fallen from 4.5 to 4%. That means it has been reduced by 50 basis points. However, this cut will be implemented twice at a rate of 25-25 basis points. The first cut will take effect on December 14, and the second on December 28.
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What is the MPC?
The MPC makes the most important monetary policy decisions. It is led by Reserve Bank Governor Shaktikanta Das. This committee has six members, including the governor. This is Das’s final MPC meeting of the current term. His term expires on December 10.
Fall in the share market
The stock market decreased because there was no adjustment in the repo rate at the MPC meeting. At 10:15 a.m., the Sensex slid 167.32 points to 81,598.54. At the same time, the Nifty also fell. The Nifty lost 57.45 points, to 24,650.95. Earlier on Friday morning, the market opened in the green.
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