RBI's Monetary Policy Committee Meeting Starts Today, What To Expect
RBI's Monetary Policy Committee Meeting Starts Today, What To Expect

The Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) is set to begin its three-day meeting on June 5, right after the Lok Sabha election results are announced. This crucial meeting will wrap up on June 7, with RBI Governor Shaktikanta Das revealing the committee's decisions at 10 am.

The six-member MPC is responsible for setting India's benchmark interest rate, known as the repo rate. This rate is pivotal as it influences borrowing costs for banks and subsequently affects loan interest rates for businesses and individuals.

This upcoming meeting marks the second MPC gathering since the start of the new financial year on April 1, 2024, and the third one in 2024, following the February policy meeting held from February 6-8. The MPC typically convenes for three days before announcing its decisions, with the next meeting scheduled for August 6.

Governor Das and his committee will provide insights into the RBI's strategy for the ongoing fiscal year, balancing the goals of economic growth and managing inflation, which is targeted at 4 percent. Most economists anticipate that the RBI will maintain the repo rate at 6.50 percent, continuing its current stance of 'withdrawal of accommodation'.

RBI's Recent Repo Rate Hike and MPC Members
The Reserve Bank of India (RBI) last raised the repo rate by 25 basis points (bps) on February 8, 2023, bringing it to 6.5 percent. To clarify, one basis point is equal to 0.01 percent. Previously, in December 2022, the RBI's Monetary Policy Committee (MPC) had set the repo rate at 6.25 percent.

Meet the Six-Member Monetary Policy Committee
The MPC is led by RBI Governor Shaktikanta Das and includes three external members. Governor Das' term is scheduled to conclude in December this year. The other members of the committee are Shashanka Bhide, Ashima Goyal, Jayanth R. Varma, Rajiv Ranjan, and Michael Debabrata Patra. Each member has one vote, and in case of a tie, the Governor has the deciding vote.

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