The Reserve Bank of India is expected to keep interest rates on hold on Thursday for the fourth straight meeting but maintain a cautious tone despite a sharper-than-expected pullback in inflation in the last few months.
Unveiling the bi-monthly monetary policy statement in Mumbai, RBI Governor Urjit Patel said “significant and postponed deviations” from fiscal targets would make matters “more challenging” going forward.
RBI will announce the new monetary policy today, the Monetary Policy Committee is likely to bring down the repurchase rate by 50 basis points from 6.25 percent. Rupee edged down by 5 paise against the dollar ahead of the RBI policy.
In 2002, an advisory group argued for the creation of a Monetary Policy Committee in India. Much of what it recommended is relevant in the context of the current debate on MPC, based on a revised draft of the Indian Financial Code that was released last week.