“We are actively disinflationary”: RBI keeps repo rate unchanged at 6.5% for fifth time in a row

11:39 AM Dec 08, 2023 | PTI |

Mumbai: The Reserve Bank of India on Friday decided to keep the policy rate unchanged at 6.5 per cent for the fifth time in a row as it maintains a tight vigil on inflation.


The rate increase cycle was paused in April after six consecutive rate hikes, aggregating to 250 basis points since May 2022.

Announcing the bi-monthly monetary policy, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) unanimously decided to keep the repo rate unchanged at 6.5 per cent.

He said the MPC will remain ”actively disinflationary”.

According to him, the growth projection has been raised to 7 per cent for the current financial year from 6.5 per cent earlier.


The central bank projected the Consumer Price-based Inflation (CPI) based retail inflation at 5.4 per cent for the current fiscal.

The MPC meeting took place against the backdrop of inflation declining to 4.87 per cent in October. The November print of inflation is expected to be released next week.

The government has mandated the RBI to keep CPI inflation at 4 per cent with a margin of 2 per cent on either side.

Following are the highlights of RBI’s bi-monetary policy statement:

  • RBI keeps benchmark interest rate unchanged at 6.5 pc
  • Proposes to enhance UPI transaction limit for payment to hospitals and educational institutions from Rs 1 lakh to Rs 5 lakh.
  • Hikes GDP growth projection for current fiscal to 7 pc, from 6.5 pc earlier
  • Pegs GDP growth in December, March quarters at 6.5 pc, 6 pc
  • Retains average retail inflation projection at 5.4 per cent for 2023-24
  • Inflation outlook to be considerably influenced by uncertain food prices
  • Intermittent vegetable price shocks could once again push up headline inflation in November and December
  • Rupee exhibited low volatility compared to its emerging market peers in 2023
  • Relative stability of the rupee reflects the improving macroeconomic fundamentals and its resilience in the face of formidable global tsunamis.
  • Forex reserves stood at USD 604 billion as on December 1, remain confident of meeting external financing requirements comfortably
  • RBI to remain vigilant and ready to act, as per the evolving outlook
  • India better placed to withstand uncertainties compared to many other countries
  • Proposed to hike e-mandate for recurring payments to Rs 1 lakh from current Rs 15,000
  • RBI to set up a cloud facility for the financial sector to enhance data security, privacy
  • Next monetary policy committee meeting on February 6-8, 2024.

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