RBI reduced GDP estimates, no change in repo rate

New delhi date. 05 December 2019, Thursday

The Reserve Bank of India has not changed the repo rate, though the RBI has reduced the GDP estimates. The repo rate will remain unchanged at 5.15%. The meeting of the monetary policy committee began on December 3 and the repo rate was announced today. Notably, the RBI decides on key policy rates with regard to retail inflation. A total of 135 basis points have been cut in the repo rate this year. For the first time in nine years, the repo rate is so low. This is the lowest level of the repo rate since March 2010. The reverse repo rate is 4.90%. The bank rate is at 5.40%.

Aside from the repo rate decision, the RBI has projected GDP. According to the RBI, GDP will fall sharply during the year 2019-20 and this can come down to 6% from 5% That made the economy shake. These previously announced GDP figures indicate a slowdown in the economy. In the July-September 2019 quarter, India's GDP fell to only 4.5%, which is at a six-and-a-half year low. This is the sixth consecutive quarter when GDP is sluggish.