Status quo in rates don’t imply future action: RBI Governor

Shaktikanta Das
Shaktikanta Das (Photo Credit-Bloomberg)

New Delhi, Feb 6 : Hinting at rate cuts in its upcoming monetary policy meets, RBI Governor Shaktikanta Das on Thursday said that the status quo in repo rate should not be seen as a pointer towards future course of action, as apex bank would take decisions as per the evolving situation and the requirement.

Maintaining the accommodative stance, Governor Das said that the Monetary Policy Committee (MPC) recognises that there a policy space is available for future action.

The MPC kept the repo rate unchanged at 5.15 per cent and the reverse repo rate has been kept at 4.9 per cent, with a view to check the rising inflation.

Referring to the status quo maintained in terms of rates and the accommodative stance, Das told reporters here: “It should not be read as a pointer for future action of the monetary policy committee. The monetary policy committee will be guided by the evolving situation and take whatever steps are required at the appropriate time in the most opportune manner to optimise the impact of various monetary policy actions.”

This is the second consecutive monetary policy whereby the RBI has kept the rates unchanged, after a cumulative reduction of 135 basis points in its previous five policy meets.

The apex bank continued to hold the pause button on the repo-rate cut with an aim to reign in the surging inflation.

“The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth, while ensuring that inflation remains within the target. 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,” an RBI statement said

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