News

Published: April 5, 2024
Updated: April 5, 2024

RBI Likely to Maintain Status Quo in First FY25 MPC Meeting

The Reserve Bank of India (RBI) is set to announce its Monetary Policy Committee's (MPC) decision on interest rates today, marking the first meeting of Financial Year 2024-25 (FY25). Led by RBI Governor Shaktikanta Das, the six-member MPC will assess the impact of global economic factors on India's GDP growth and inflation trajectory.

Expectations and Projections:

Experts anticipate that the MPC will keep both the policy repo rate and stance unchanged, mirroring the trend from the previous financial year. With GDP growth estimates revised upward and consistent CPI expansion, analysts predict a status quo on rates and stance until the August 2024 MPC review.

Insights from Economists:

Aditi Nayar, Chief Economist at ICRA, suggests that recent GDP growth trends and CPI prints support the notion of maintaining rates and stance in the upcoming meeting. She emphasizes the importance of factors like monsoon outlook and US Fed rate decisions in shaping future policy adjustments.

Key Dates and Meetings:

The MPC's schedule for FY25 includes meetings in June, August, October, December, and February, providing insights into the trajectory of monetary policy decisions throughout the year.

Market Expectations:

Indian bond yields are expected to remain steady ahead of the policy decision, with participants awaiting guidance on interest rate movements. The benchmark 10-year yield is anticipated to trade within a specific range until the announcement.

As the RBI's MPC convenes for its first meeting of FY25, market participants and analysts keenly await the outcome. While projections suggest a continuation of the current policy stance, factors such as GDP growth, inflation, and global economic conditions will continue to shape future monetary policy decisions.