RBI’s Decision can Shock the Common Man ! Decision of Monetary Policy Shortly
New Delhi: The decision on the interest rates will come today after the review meeting of Reserve Bank of India from February 4 to 6. The meeting of the six-member Monetary Policy Committee (MPC) headed by Reserve Bank Governor Shaktikanta Das began on Tuesday. This happened at a time when the fiscal deficit is projected to increase in the general budget amid a sluggish economy and rising inflation.
Economists believe that the RBI will not make any change in interest rates like last time. The Reserve Bank had continuously cut interest rates in 2019 to generate demand in the economy. However, it did not make any changes in the previous review. It was said that the RBI had stopped the move due to rising inflation. In October, the RBI cut the repo rate by a quarter of a per cent, bringing it down to 5.15. This is the lowest rate since March 2010.
In fact, the government has given the Monetary Policy Committee, which announces the prime policy rate every two months, the responsibility of keeping the retail inflation based on the consumer price index at 4 per cent with a range of two per cent. Retail inflation peaked at 7 per cent in December 2019. The main reason for this is the rise in prices of vegetables. However, before this, inflation had remained at the parent level for several months. According to experts, the Monetary Policy Committee (MPC) is a big challenge for the members.