India's Monetary Policy Committee hiked the benchmark repo rate by 35 basis points to the highest since February 2019 as it continues efforts to quell inflation in the economy amidst resilient economic activity.
The MPC decided to raise the repo rate to 6.25% by a majority of five out of the six members. Jayanth Varma voted against the repo rate hike.
The standing deposit facility rate, pegged 25 basis points below the repo rate, is adjusted to 6%. The marginal standing facility rate, which is 25 basis points above the repo rate, is now at 6.50%.
Here are the key takeaways from RBI Governor Shaktikanta Das' Monetary Policy announcement:
India's GDP Growth is resilient. It is holding on and doing well in a world of slowing growth.
Headline inflation is moderating and, in fact, worst of inflation is behind us. Globally, the same trend is visible.
While inflation is moderating, there is no room for complacency. We have to be watchful, nimble in our actions should it become necessary. The battle on inflation is not over.
We are ready to undertake liquidity operations to inject liquidity but will look for durable signs of turn in liquidity cycle.
Story of Indian rupee is one of resilience and stability. We remain committed to act in event of excessive volatility in currency market.
Current account deficit is eminently manageable. Let there be no doubt about it.
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