Monetary Momentum: RBI's Crucial Policy Deliberations

The Reserve Bank of India's Monetary Policy Committee is discussing its bi-monthly policy amid high retail inflation. Despite the current economic slowdown, experts agree that any interest rate cut will likely only occur in 2025. The RBI aims to maintain stability to support growth and curtail inflation.

The Reserve Bank of India's high-level panel gathered on Wednesday to deliberate bi-monthly monetary policy, amidst expectations of maintaining the interest rate status quo due to elevated retail inflation.

The six-member Monetary Policy Committee, led by RBI Governor Shaktikanta Das, will announce its decision on Friday, right before Das's term concludes on December 10. Tasked with keeping CPI-based inflation at 4% within a margin of 2%, the committee faces mounting pressure as India's GDP growth slows and inflation rises.

Experts, including those from SBI, forecast that any possible rate easing will not occur until 2025. Industry leaders support maintaining the current repo rate at 6.5% to sustain housing demand and inject liquidity via open market operations rather than rate cuts.

(With inputs from agencies.)