RBI maintains status quo, keeps repo rate unchanged at 6.5%

RBI maintains status quo, keeps repo rate unchanged at 6.5%

Sujan Hajra, Chief Economist at Anand Rathi Financial Services, said "Calibrated reduction of SLR announced in the policy today is in line with the long-term strategy of the RBI to scale down pre-emption of bank resources by the government without undermining quality of bank balance sheet".

In its last bi-monthly monetary policy, the bank had kept the repo rate unchanged at 6.5 percent.

Not only did the 6-member committee decide to keep the repo rate (the rate at which RBI lends money to banks) unchanged, but also kept its "calibrated tightening" stance in tact.

This is for the second time in a row that the central bank did not tinker with the interest rate.

What could be RBI's likely rate action?

Weaker global oil prices and domestic food prices are expected to drag the headline inflation rate below projections.

Will RBI change its outlook on inflation?

More news: Cardi B says she and husband Offset are 'not together anymore'
More news: Soyuz rocket lifts off with new crew for ISS
More news: Magic Johnson reportedly led free agent pitch for Bryce Harper

The six-member MPC, headed by RBI governor Urjit Patel had started its three-day meet on December 3 for the fifth bi-monthly monetary policy review of the current financial year.

The CPI inflation has been projected at 2.7-3.2 percent for the October-March period, the statement said.

Inflation projection lowered: Inflation has been projected at 2.7-3.2 per cent for second half of FY2018-19 and 3.8-4.2 per cent for the first half of FY 2019-20, with risks tilted to the upside. Oil prices have fallen almost 30 per cent after hitting a high of $86/barrel early October. This could comfort MPC, given that falling crude prices ease import pressures.

The RBI also announced an auction of a 12-day Government of India Cash Management Bill.

Some experts say RBI could cut the cash reserve ratio by 50bps, given that it has remained unchanged since 2013.

Tuesday said it would inject Rs 10,000 crore into the system through the purchase of government securities on December 6 to increase liquidity.

How will RBI address the India liquidity crisis?

Related Articles

  • Rahm cruises to emphatic Hero World Challenge success

    Rahm cruises to emphatic Hero World Challenge success

    I know he's up there with my grandpa telling him everything about golf even though Seve knows a little bit. Everyone was under par going into the weekend, with Jason Day bringing up the rear at 1-under 143.
    Spotify shares the top tunes and trends of 2018

    Spotify shares the top tunes and trends of 2018

    He also had three songs - his three No. 1s, to be precise - in the top five of that platform's top 100 global songs chart. The Grammy victor scored 8.2 billion streams on Spotify in 2018, making him the most-streamed artist ever on the platform.
    Cincinnati Bengals' A.J. Green out for season with toe injury

    Cincinnati Bengals' A.J. Green out for season with toe injury

    Lindsay also became the first undrafted rookie in Broncos history to top 1,000 combined yards rushing and receiving in a season. The plan was to give it to their 190-pound running back and let him live up to his new nickname.
  • Fortnite dev Epic Games is launching a Steam rival, teases bigger reveal

    Fortnite dev Epic Games is launching a Steam rival, teases bigger reveal

    The Epic Games store is Epic Games' challenge to the Steam store which is notorious for its 30% cut from the developers. Epic's Nick Chester would later tell fans that the big Game Awards announcement wasn't linked to Season 7.
    AgustaWestland middleman Christian Michel extradited

    AgustaWestland middleman Christian Michel extradited

    In coming days the worries of Sonia Gandhi and Ahmed Patel will be when they will be confronted with Michel by CBI and ED. At present, Michel is at the CBI headquarters in the national capital where he is being probed by the agency officials.
    New Caledonians ordered to shelters in tsunami alert after big quake

    New Caledonians ordered to shelters in tsunami alert after big quake

    New Zealand's ministry of civil defence and emergency management tweeted that there was no tsunami threat to the nation's coasts. The Joint Australian Tsunami Warning Centre issued an update saying that no tsunami risk has been identified to Australia.
  • Yemen's Houthis head to Sweden for high-stakes peace talks

    Yemen's Houthis head to Sweden for high-stakes peace talks

    The International Committee of the Red Cross said it welcomed the announcement and would oversee and facilitate the exchange. Yemen has been wracked by violence since 2014, when the Houthi rebel group overran much of the country.
    George Soros-backed university ‘forced out’ of Hungary

    George Soros-backed university ‘forced out’ of Hungary

    "In the case of the CEU we are being forced out of the country", said Liviu Matei, the CEU's pro-rector, at a press conference. However, CEU will keep its Budapest campus and those students who have enrolled there will be able to complete their studies.
    Baltimore takes down the Falcons: Handing out 3 Ravens game balls

    Baltimore takes down the Falcons: Handing out 3 Ravens game balls

    Beasley punctuated the score by slam dunking the ball over the goalpost, thus incurring an unsportsmanlike conduct penalty. Credit to them, they came out, they had a good plan for us and they executed the plan a lot better than we did".
  • Kanye West Apologizes For Pulling A Kanye During A Broadway Show

    Kanye West Apologizes For Pulling A Kanye During A Broadway Show

    Kanye West apologized for pulling a Kanye during a Broadway show and I'm shooketh (the umpteenth level of shook). Kanye West issued a rare apology after being called out for his bad behavior by a cast member of The Cher Show .
    Prime Minister Narendra Modi attends Priyanka Chopra - Nick Jonas reception

    Prime Minister Narendra Modi attends Priyanka Chopra - Nick Jonas reception

    Cape Town - Hot off the release of their stunning wedding album, Nick Jonas and Priyanka Chopra hosted a final wedding reception . Priyanka also introduced Modi to her brother-in-law Joe Jonas and his fiance " Game Of Thrones " actor Sophie Turner.
    'China has agreed to reduce, remove tariffs on U.S.  cars': Donald Trump

    'China has agreed to reduce, remove tariffs on U.S. cars': Donald Trump

    Tariffs remain in place, but the 90 days pause would allow both of them to see if there is any genuine room for compromise. Unrelated directly to trade, China has agreed to crack down on the production and distribution of Fentanyl.