Reserve Bank of India (RBI) today announced the release of the first bimonthly monetary policy. As per the market expectations the central bank key interest rates unchanged. RBI retained the repo rate of 8 percent.
RBI Governer Raghuram Rajan kept the repo rate unchanged by 8% in the monetary policy review of the central bank. Rajan said, “Lead indicators do not point to any sustained revival in industry and services as yet”.
This decision will not affect the monthly instalments (EMI) of vehicle, housing and other loans. Moreover, the CRR has also been retained at 4 percent.
The RBI had already indicated that it will be a priority to cease inflation only. , Although the Indian industries are making all round pressure to cut the interest rates to accelerate the economic growth.
RBI is trying constantly to tame the inflation, regarding this RBI increased repo rate by 0.25 per cent in the month of January to 8 per cent. A report issued by RBI for 2014-15 is estimated at 5 to 6 per cent growth rate.
Bhattacharya the chairman of the bank said, ‘Deposit rate cut will not be consider because they are affecting depositor, and we might don’t want to. Our rates are still higher than the July 15 and I do not foresee any immediate decrease in the rate’. Given the ample liquidity in the system, we’ll need to do something or not – wholesale depositors to consider in relation to the initiative.” Prime Minister’s Economic Advisory Council (Pimisi) Chairman C Rangarajan said in regard to the review, “it is difficult to strike a balance. I certainly agree that the RBI’s priority is to stabilize inflation so they need to keep a constant eye on inflation. “