RBI maintains status quo; no change in repo rate, reverse repo rate

The Reserve Bank of India (RBI) on Thursday left the interest rates unchanged, but maintained an accommodative stance, implying that they would consider more rate cuts in future if the need arises to support the economy hit by the COVID-19 crisis.

“Accommodative stance of the monetary policy will continue as long as necessary to revive growth and mitigate the impact of COVID19 pandemic, while ensuring that inflation remains within target going forward,” RBI Governor Shaktikanta Das said at a press conference on Thursday.

The RBI kept interest rates unchanged at its bimonthly monetary policy review. The repo rate remains unchanged at 4%, while the reverse repo rate has been kept at 3.3%. 

RBI had last revised its policy rate on May 22, in an off-policy cycle to perk up demand by cutting interest rate to historic low.

The decisions were announced after a meeting of the six-member Monetary Policy Committee (MPC), headed by the RBI Governor. This is the 24th meeting of the MPC. Das said the MPC voted for keeping interest rate unchanged and continued with its accommodative stance to support growth.

“Global economic activity has remained fragile; surge in COVID-19 cases has subdued early signs of revival,” Shaktikanta Das said after the meeting.