RBI Monetary Policy 2023: Central Bank Keeps Repo Rates Unchanged At 6.5%

Contrary to widespread speculations in the media, the Reserve Bank of India (RBI) on Thursday kept the repo rates unchanged at 6.5 percent.

RBI has kept the repo rate unchanged at 6.5% with readiness to act should the situation so warrant, Governor Shaktikanta Das while announcing the three-day meeting of its Monetary Policy Committee said.

The Monetary Policy Committee meeting of the RBI took place on April 3, April 5, and April 6 to begin the central bank's first bimonthly review of the new fiscal year. A year is divided into six bimonthly reviews of the central bank's monetary policy. Additionally, there are out-of-cycle reviews, where the central bank holds extra sessions in urgent situations.

In order to control inflation, the RBI's Monetary Policy Committee (MPC) decided to increase the repo rate by 25 basis points, to 6.5 percent, at its most recent meeting in early February. Since May 2022, the RBI has increased the repo rate—the interest rate at which it loans to banks—by 250 basis points. A weapon of monetary policy that normally works to reduce demand in the economy and lower inflation is raising interest rates.

In order to control inflation, the RBI's Monetary Policy Committee (MPC) decided to increase the repo rate by 25 basis points, to 6.5 percent, at its most recent meeting in early February. A weapon of monetary policy that normally works to reduce demand in the economy and lower inflation is raising interest rates.