The Reserve Bank OF India (RBI)  is likely to keep the benchmark interest rates unchanged in its next monetary policy review in view of heightened retail inflation which has persistently remained above its comfort level, feel experts.

However, with the economic growth continuing to remain in the negative territory for the second consecutive quarter ending September, the central bank is likely to continue with the accommodative monetary stance keeping the hope alive for a rate cut as and when needed. The six-member Monetary Policy Committee (MPC) headed by RBI Governor is scheduled to meet for two days starting December 2. The resolution of the sixth bi-monthly MPC meeting would be announced on December 4.

In its last MPC meeting in October, the RBI kept policy rates unchanged to help tame inflation that in recent times has surged past 6 percent mark. The RBI projected the country's GDP to contract 9.5% in the current financial year due to the pandemic. It has cut policy rates by 115 basis points since February. "With inflation continuing to trend well above RBI's medium-term target of 4%, there is limited room for a rate cut in the upcoming policy. We have seen encouraging signs of a pick-up in economic activity and a return of consumer demand, buoyed by the festive season," Kotak Mahindra Bank group president consumer banking Shanti Ekambaram said.

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