New Delhi: The Reserve of India Governor (RBI) Shaktikanta Das Thursday warned that the fight against the inflation is still on as the “job is only half done.”
“Our job is only half done, having brought inflation within the target band (4-6 per cent). Our fight against inflation is not yet over,” said the RBI Governor at the latest monetary policy meeting. The meeting was held from June 6-8, while the minutes of which were published on Thursday.
In the latest, the RBI announced to keep the repo rate unchanged at 6.5 per cent for the second straight time. It should be noted that the repo rate is the rate of interest at which RBI lends to other banks.
As per the experts, the RBI’s decision to keep up the same repo rate is likely to be influenced by consistent decline in inflation (currently at an 18-month low) and its potential for further decline.
Barring the April pause, the RBI raised the repo rate by 250 basis points cumulatively to 6.5 per cent since May 2022 in the fight against inflation.
“Beyond this and given the prevailing uncertainties, it is difficult to give any definitive forward guidance about our future course of action in a rate tightening cycle,” he said, adding that the RBI will continue to remain agile and flexible in managing liquidity in the banking system.
On the global economy, he said it has sustained the growth momentum and the overall uncertainty is somewhat receding.
“Nevertheless, headwinds to global growth outlook persist. The geopolitical conflict continues unabated. Headline inflation across countries is on a downward trajectory, but is still high and above their respective targets. Central banks remain on high alert and watchful of the evolving conditions,” the RBI Governor added.
