Mumbai, 10 Feb (Xinhua) -- The Indian Central Bank announced on 10 February that it will continue to maintain its loose monetary policy stance and maintain the repo rate and reverse repo rate at the current levels of 4% and 3.35%.
Bank of India Governor Das said on the same day that with the advancement of the new crown vaccination plan and the support of fiscal and monetary policies, the Indian economy continued to recover. To continue to support economic growth, the central bank decided to keep the level of the repo rate as the benchmark rate unchanged. In response to the impact of the epidemic on the economy, the central bank cut the repo rate to 4% in May 2020, and it has continued to this day.
The RBI's keeping the benchmark interest rate level unchanged is in line with market expectations, but continues to maintain the current level of reverse repo rates and maintains accommodative monetary policy beyond expectations. As inflationary pressures in India have risen significantly, the market had previously expected the RBI to tighten liquidity and shift its monetary policy stance from accommodative to neutral.
In addition, the RBI expects the economy to grow by 9.2% in the current fiscal year (April 2021 to March 2022) and an inflation rate of about 5.3% in the next fiscal year (April 2022 to March 2023) and a slowdown in inflation to 4.5%.