Added on : 2019-02-07 13:31:17
Reserve Bank of India-led Monetary Policy Committee changed the stance to 'neutral' from 'calibrated tightening', while reduced the repo rate to 6.25% at its February policy meeting on the benign inflation outlook. The MPC led by RBI Governor Shaktikanta Das reduced the reverse repo rate under the LAF to 6%, and the marginal standing facility (MSF) rate and the Bank Rate to 6.5%.
The MPC downwardly revised the inflation outlook to 2.8% for the Q4FY19, 3.2-3.4% in H1 2019-20 and 3.9% in Q3 2019-20, with risks broadly balanced around the central trajectory.
At the December policy, inflation was projected at 2.7-3.2% in H2 2018-19 and 3.8-4.2% in H1 2019-20, with risks tilted to the upside. Also, GDP growth projection for 2019-20 was projected at 7.4% - within the range of 7.2-7.4% in H1, and 7.5% in Q3, with risks evenly balanced. At December policy, the central bank had retained 2018-19 growth outlook at 7.4% and for H1 2019-20 at 7.5%, with some downside risks. Meanwhile, the decision to change the monetary policy stance was unanimous.
The next meeting of the MPC is scheduled from April 2 to 4, 2019.