Will the repo rate come down? RBI to announce key interest rate decision on Friday morning

The Reserve Bank of India (RBI) will announce its decision on the key interest rate on Friday morning, following the conclusion of a three-day meeting of the Monetary Policy Committee (MPC). The announcement comes amid high inflation and weak GDP growth.

Experts anticipate that the central bank will likely maintain the status quo on the short-term lending rate (repo rate) but may adjust the cash reserve ratio (CRR) in response to the mixed economic signals.

The RBI shared on social media platform ‘X’: “Coming up: Monetary Policy Statement by #RBI Governor @DasShaktikanta on December 06, 2024, at 10:00 AM.”

RBI Governor Shaktikanta Das is leading the six-member MPC meeting, which started on Wednesday. This is the final MPC meeting chaired by Das, as his current term concludes on December 10.

Since February 2023, the RBI has kept the repo rate steady at 6.5%. The last rate hike occurred in February 2023, bringing the repo rate to its current level.

The government has mandated the RBI to maintain consumer price index (CPI) inflation at 4%, with a tolerance band of 2% on either side. In May 2022, during an off-cycle meeting, the MPC increased the policy rate by 40 basis points, followed by several rate hikes totaling 250 basis points between May 2022 and February 2023.

The MPC members include Nagesh Kumar, Director and Chief Executive of the Institute for Studies in Industrial Development, New Delhi; Saugata Bhattacharya, Economist; Ram Singh, Director of the Delhi School of Economics; Rajiv Ranjan, Executive Director of RBI; Michael Debabrata Patra, Deputy Governor of RBI; and Shaktikanta Das, Governor of RBI.