RBI Monetary Policy Announcement: Repo Rate Expected to Stay at 6.5% Today
The Reserve Bank of India (RBI) Monetary Policy Committee (MPC) will announce its policy decision today. The second monetary policy meeting of the financial year 2023-2024 was held from 6 to 8 June and the result will be announced today. The rate-setting panel headed by Governor Shaktikanta Das is expected to keep the repo rate unchanged at 6.5%.
Market sentiment subdued ahead of policy announcement
The Indian stock market opened on a subdued note today ahead of the announcement of the RBI monetary policy. The benchmark Sensex index was trading down 2.79 points at 62917, while the Nifty index was trading down 12 points at 18725.
Mixed trend in lending rates since last repo rate hike
The lending rates have shown a mixed trend since the last repo rate hike by the RBI. The weighted average lending rate on new rupee loans (WALR) of SCBs decreased by 23 basis points (bps) from 9.32% in March 2023 to 9.09% in April 2023. The average marginal cost of 1-year fund-based lending rate (MCLR) of SCBs remained unchanged at 8.60% in May 2023.
Nifty likely to cross 18,887.60 in coming days
The Nifty has been performing on a positive note in the last five business sessions. The index has gained more than 1% in this period. With the RBI policy in the headlines, the overall sentiment in the market is positive. It is expected that the Nifty may soon cross its all-time high of 18,887.60.
64 economists expect no change in repo rate
According to a Refinitiv poll, all 64 economists expect that there will be no change in the 6.50% repo rate at the conclusion of the RBI’s 6-8 June meeting. Brokerage Reliance Securities also believes that the RBI may keep the repo rate unchanged at 6.5% on June 8 and the bank may wait to see the economic impact of the series of rate hikes in the last one year.
RBI may wait to see economic impact of rate hikes
The RBI may wait to see the economic impact of the series of rate hikes before taking any further decision on the repo rate. The central bank may want to see how the rate hikes impact inflation, growth, and credit growth. The RBI may also want to see how the global economy performs in the coming months.
Overall, the market sentiment is positive ahead of the RBI monetary policy announcement. The Nifty is likely to continue its positive momentum in the coming days. However, the RBI may wait to see the economic impact of the rate hikes before taking any further decision on the repo rate.
This article generated by AI.
Frequently Asked Questions
The current RBI repo rate is 6.50%. The repo rate is the rate at which the RBI lends money to commercial banks.
It is possible that the RBI will increase the repo rate in 2024. The decision to increase the repo rate will depend on a number of factors, including the inflation rate, the growth rate of the economy, and the direction of the rupee.
The RBI is scheduled to announce its monetary policy decision on June 8, 2023. It is possible that the RBI may increase the repo rate in June 2023. However, the decision to increase the repo rate will depend on a number of factors, including the inflation rate, the growth rate of the economy, and the direction of the rupee.
The repo rate is the rate at which the RBI lends money to commercial banks. When the RBI increases the repo rate, it becomes more expensive for banks to borrow money. This, in turn, can lead to higher interest rates on loans and other financial products. When the RBI decreases the repo rate, it becomes less expensive for banks to borrow money. This, in turn, can lead to lower interest rates on loans and other financial products.
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