The Reserve Bank of India (RBI) maintained its key lending rate at 6.5% for the seventh consecutive time, announced RBI Governor Shaktikanta Das. The decision, reached by a 5:1 majority at the Monetary Policy Committee (MPC) meeting, suggests that loan interest rates are likely to remain stable.

After pausing rate increases last April following six consecutive hikes of 250 basis points since May 2022, the RBI Governor noted that inflation is nearing targets, with a projected retail inflation of 4.5% for the year. The RBI's mandate is to maintain retail inflation at 4%, with a 2% margin on either side.

While core inflation has decreased over nine months and the fuel component has experienced deflation for six consecutive months, food price uncertainties persist, posing challenges to inflation control efforts. Mr. Das emphasized the need for vigilance against inflation risks that could disrupt the disinflation process.

The RBI projects India's growth at 7% for the fiscal year, with 7.1% and 6.9% growth expected in the first two quarters, respectively, noting balanced risks. The Indian rupee remains stable compared to major currencies, reflecting robust macroeconomic fundamentals. Additionally, India's liquidity situation improved in March, and foreign portfolio investment increased, leading to record-high forex reserves. Globally, the economy has shown resilience, with expectations of faster growth in global trade in 2024.

The Reserve Bank of India (RBI) maintained its key lending rate at 6.5% for the seventh consecutive time, announced RBI Governor Shaktikanta Das. The decision, reached by a 5:1 majority at the Monetary Policy Committee (MPC) meeting, suggests that loan interest rates are likely to remain stable.

After pausing rate increases last April following six consecutive hikes of 250 basis points since May 2022, the RBI Governor noted that inflation is nearing targets, with a projected retail inflation of 4.5% for the year. The RBI's mandate is to maintain retail inflation at 4%, with a 2% margin on either side.

While core inflation has decreased over nine months and the fuel component has experienced deflation for six consecutive months, food price uncertainties persist, posing challenges to inflation control efforts. Mr. Das emphasized the need for vigilance against inflation risks that could disrupt the disinflation process.

The RBI projects India's growth at 7% for the fiscal year, with 7.1% and 6.9% growth expected in the first two quarters, respectively, noting balanced risks. The Indian rupee remains stable compared to major currencies, reflecting robust macroeconomic fundamentals. Additionally, India's liquidity situation improved in March, and foreign portfolio investment increased, leading to record-high forex reserves. Globally, the economy has shown resilience, with expectations of faster growth in global trade in 2024.