RBI keeps repo rate stable for 11th consecutive time, cuts CRR

New Delhi| The results of the Monetary Policy Committee meeting of the Reserve Bank of India have been announced. This time also no change was made in the repo rate. According to the announcement made by RBI Governor Shaktikanta Das, the repo rate has been kept stable at 6.50 per cent for the 11th consecutive time.

Experts were already expecting that there would be no change in the repo rate this time too.

RBI Governor said that our effort is to follow the Flexible Targeting Framework of the RBI Act. Price stability is important for every sector of our economy. It affects the purchasing power of people, hence its importance for businesses also. According to the RBI Governor, the decision has been taken to cut CRR by 50 basis points, after which the cash reserve ratio has been reduced to 4 percent.

CRR is the percentage of total deposits of a bank which the bank has to keep as reserve with the central bank in the form of liquid cash.

The committee has also retained the Standing Deposit Facility (SDF) at 6.25 per cent, according to announcements by the Monetary Policy Committee. The bank rate and marginal standing facility have been kept constant at only 6.75 per cent. The committee believes that along with sustainable price stability, the foundation of high growth can be kept strong.

The Standing Deposit Facility (SDF) was introduced by the Reserve Bank of India (RBI) as a monetary policy tool on April 8, 2022. The MPC forecast inflation for FY2025 at 4.8 percent. Inflation is estimated to be 5.7 percent in the third quarter (October-December) of the current financial year and 4.5 percent in the fourth quarter (January-March). Inflation for the first and second quarters of FY 2026 is projected to be 4.6 percent and 4 percent, respectively.