India’s Central Bank Raises Rate For Fourth Straight Time
India’s central bank raised its benchmark rate for the fourth straight time on Friday, to contain high inflation.
The Monetary Policy Committee of the Reserve Bank of India, led by Governor Shaktikanta Das, voted 5-1 to hike its key interest rate, the repo, by 50 basis points to 5.90 percent from 5.40 percent with immediate effect.
Consequently, the standing deposit facility rate stands adjusted to 5.65 percent and marginal standing facility and the bank rate to 6.15 percent.
The MPC also decided by a majority of 5-1 to remain focused on withdrawal of accommodation to ensure that inflation remains within the target going forward, while supporting growth.
The governor said inflation is hovering around 7 percent and it is expected to remain elevated at around 6 percent in the second half of this year.
Consumer price inflation is projected at 6.7 percent in 2022-23, unchanged from the previous outlook.
At the same time, the RBI downgraded its real GDP growth forecast for 2022-23 to 7.0 percent from 7.2 percent.
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