RBI Monetary Policy: Central Bank Keeps Repo Rate Unchanged At 6.5%; Rates Paused For 9th Consecutive Time

New Delhi: The Reserve Bank of India kept the key interest rates unchanged for the 9th consecutive time on Thursday, and also keeping the growth projection unchanged at 7.2 percent for the current financial year.

RBI Governor Shaktikanta Das, announcing the outcome of the three-day Monetary Policy Committee (MPC) meeting said that the repo rate has been kept unchanged at 6.5 percent. "Consequently, the standing deposit facility (SDF) rate remains unchanged at 6.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 6.75 percent, " he added.

The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth. These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.

Das cautioned that the MPC has to be vigilant as country is witnessing persistently high food inflation stating that MPC will remain watchful of elevated food inflation.

Repo rates have been held at 6.5 percent since February 2023. 

"The RBI's decision to keep repo rates unchanged at 6.5% for ninth consecutive time aligns well with yesterday's announcement on indexation benefits. It sets a positive tone for the housing industry. Maintaining interest rates offers consistency in borrowing costs, which will prompt more aspiring homebuyers to consider taking the plunge - and thus drive demand in the housing market. With interest rates staying steady, EMIs will remain manageable for current and potential homeowners, potentially leading to increased home sales - particularly in the price-sensitive affordable segment," said Anuj Puri, Chairman - ANAROCK Group.