New Delhi, February  2024.

The Reserve Bank of India (RBI) Monetary Policy Committee (MPC) has kept repo rates unchanged at 6.5 percent. It has also decided to remain focused on the withdrawal of the accommodative stance, Governor Shaktikanta Das said. This is the sixth consecutive unchanged decision and comes after the Interim Budget was announced on February 1, 2024.

RBI Monetary Policy by “Anu Aggarwal, President & Head Corporate Banking, Kotak Mahindra Bank”

Anu Aggarwal, President & Head Corporate Banking, Kotak Mahindra Bank said, "As the RBI maintains its stance of no change on interest rates for the sixth consecutive policy review, we acknowledge the stability it brings to the financial landscape. The sustained pause in the repo rate is poised to benefit India's economic trajectory positively. Moreover, the remarkable growth in capital expenditure witnessed in FY24, coupled with robust capex push by the government underscores a pivotal moment for economic resurgence. The capex push also aligns with the broader endeavour to propel India towards achieving its $5 trillion economy milestone.”

Reactions - Divam Sharma, Founder and Fund Manager at Green Portfolio

"As we had expected, the central bank has kept the repo rate unchanged maintaining the status quo. This has come following the global cues as food inflation stays high but overall inflation remains stable.

The GDP forecast has been raised for the first quarter of FY25 to 7.2% following how the Indian economy has been growing beyond expectations.

An unchanged repo gave way for some fleeting enthusiasm for the markets but we don't see much significant impact, particularly in the long run. Equity investors should remain cautious as markets are volatile and this volatility is expected to continue."

Anirudh Garg, Partner and Fund Manager at Invasset on RBI MPC announcements

"In today's monetary policy announcement, the Governor of the Reserve Bank of India emphasized two critical points. First, he highlighted the optimistic outlook for India, with robust growth projections and inflation being effectively managed. The decision to maintain a steady monetary stance is driven by a couple of strategic considerations. Firstly, with upcoming elections, it's imperative to avoid inflationary pressures to ensure economic stability. Secondly, in light of the US Federal Reserve's decision to maintain its current interest rates, any reduction in rates by India could lead to a significant depreciation of the Indian Rupee. This careful approach underscores the RBI's commitment to balancing growth aspirations with macroeconomic stability, particularly in the context of global financial dynamics."