RBI Fourth Bi-Monthly Policy 2017-18
RBI monetary policy: Repo rate kept unchanged at 6%
The Reserve Bank of India’s (RBI’s) six-member Monetary Policy Committee (MPC), headed by Governor Urjit Patel, kept the repo rate – the key policy rate at which the RBI lends money to banks – unchanged at 6%.
In its fourth bimonthly review of the monetary policy, the RBI has lowered the statutory liquidity ratio (SLR) current 20.00% by 50 basis points to 19.5 per cent, with effect from October 14 fortnight.
In the one year since the setting up of the MPC in October 2016, it has lowered the repo rate twice – by 25 basis points each in October 2016 and August 2017.
Repo rate under the liquidity adjustment facility (LAF) unchanged at 6.00%.
The reverse repo rate under LAF also remains at 5.75%.
Cash reserve ratio also remains unchanged at 4.00%.
The central bank maintained its neutral policy stance but acknowledging sluggish economic activity, lowered its fiscal 2018 projection for gross value added, a growth metric, to 6.7% from 7.3%.
The central bank has a medium-term target for CPI inflation at 4%.
The central bank added that inflation is expected to rise from its current levels to between 4.2 to 4.6% in the second half of 2017.