Monetary Policy is the policy provided by the RBI and during the monetary policy committee meeting RBI exposed that they left the repo rate unchanged at 4% since August 2020 and the committee maintains the accommodative stance. Apart from that the also the reverse repo rate remains unchanged at 3.35%. During these decisions, the meeting was conducted in February for 3 days and Mr. Shaktikanta Das, Dr. Shashanka Bhide, Dr. Ashima Goyal, Prof. Jayanth R. Varma, Dr. Mridul K. Saggar and Dr. Michael Debabrata Patra participated in the panel and discussed about the economy, other factors and issues related with the public. Accommodative Stance is the process where the in the future the lowering of interest rates to revive growth and demand in the economy. As discussed above the MPC has declared to continue with the stance for the current financial year and to the next financial year, so the growth could be revived and can tackle the impact of COVID19 on the economy and to maintain the target. Check the policy rates declared by the RBI, Repo Rate 4%, Reverse Repo Rate as 3.35%, Marginal Standing Facility as 4.25% and Bank Rare as 4.25%. The repo rates discussed by the MPC means the rate that the bank borrows money from the central bank.
RBI Monetary Policy Highlights:
- Repo Rate - It is the rate where bank borrows money from RBI.
- Reverse Repo Rate- It is the rate where RBI borrows money from banks.
- Marginal Standing Facility- It is the rate bank borrows funds from RBI, during the inter-bank liquidity interest rates are volatile.
- Bank Rate - It is the rate where RBI lends money without any security to commercial banks.
- MPC Inflation - Rise in the vegetables price, fuel process, when it comes to the inflation RBI expects for January to March at 5.2%, from 2021 April to September 5.2 -5% and for the remaining quarter of the next financial year 4.3%.
- Growth- As per MPC the sales, services, infrastructure, and other units are reviving also the COVID vaccination drive has also shown positive growth. Be it transportation, importing. exporting and other according to the economic survey the growth is in line.
- Online access to the Retail investors - RBI offers online access to the government security markets directly from Reserve bank that is Retail Direct.
- 24x7 Help Line - RBI has created 24/7 helpline for the customers to inquire their queries, etc.