FX.co ★ India Central Bank Keeps Key Rates Unchanged

India's central bank upheld its interest rates for the ninth consecutive session on Thursday.

The Monetary Policy Committee of the Reserve Bank of India, led by Governor Shaktikanta Das, voted 4-2 to keep the policy repo rate steady at 6.50 percent.

As anticipated, the decision reflected expectations, with committee members Ashima Goyal and Jayanth Varma casting votes for a 25 basis points reduction in the policy repo rate.

The rate has been held at 6.50 percent since February 2023.

The MPC reaffirmed its 4-2 vote to focus on the withdrawal of accommodation to ensure inflation progressively aligns with the target while supporting economic growth.

Governor Das emphasized the bank's steadfast commitment to achieving a durable alignment of inflation with the 4 percent target.

The MPC underscored the importance of maintaining a disinflationary stance until there is a sustained alignment of the headline CPI inflation with the established target.

The inflation projection for 2024-25 remains at 4.5 percent, with balanced risks.

The central bank also maintained its growth forecast for the current financial year at 7.2 percent.