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RBI Governor Shaktikanta Das to announce MPC meeting outcome today; another pause in repo rate likely

RBI Governor Shaktikanta Das

RBI Governor Shaktikanta Das – The Reserve Bank of India (RBI) will release its bi-monthly monetary policy announcement today, which financial market participants will keenly observe. During his news conference on Friday, RBI Governor Shaktikanta Das will deliver the monetary policy committee (MPC) announcements. 

The RBI’s three-day bi-monthly MPC meeting began on Wednesday, October 4, and the decision is expected on Friday. The central bank is widely likely to continue its hawkish pause and keep the repo rate unchanged at 6.5 percent. 

In his remarks following the policy meeting, Shaktikanta Das predicted a “substantial increase” in headline inflation in the near term. 

“Bringing headline inflation within the tolerance band is not enough; we must remain firmly focused on aligning inflation to the target of 4.0 percent,” he stated at the June meeting. 

RBI Governor Shaktikanta Das

Headline inflation is projected to fall in September compared to August, but it will remain above the RBI’s tolerance level, according to Parijat Agrawal, head of fixed income at Union Asset Management Company. 

“The recent rise in crude oil prices and global bond yields will keep the MPC on the lookout for inflation-growth dynamics.” “At the upcoming October meeting, the committee is expected to maintain the status quo on rates and stance,” he added, according to Reuters. 

Retail inflation in India fell to 6.83 percent in August from 7.44 percent in July, but it remained above the RBI’s target band for the second month in a row.