Results of the RBI Monetary Policy Meeting, and News & Highlights of the RBI MPC Meeting in December 2024 has been published. The rate-setting monetary policy committee (MPC) is probably going to maintain the repo rate given that retail inflation surpassed its 6% tolerance level in October. Even if the second quarter (Q2FY25) GDP growth slowed to a two-year low.
It is believed that the six-member MPC will prioritize getting retail inflation down to 4%. Despite recent remarks by the chief economic adviser and a few Union cabinet ministers regarding the necessity for lower interest rates. The MPC members are anticipated to maintain their position. A majority of five out of six members at the most recent MPC meeting had agreed to maintain the policy repo rate at 6.5%.
Additionally, they unanimously agreed to shift the attitude to “neutral”. To continue to be unwaveringly focused on a long-term alignment of inflation with the objective while promoting growth. Based on findings in the RBI’s November monthly bulletin, it may not be urgent to lower the repo rate in order to sustain growth.
Key Points & Results of the December 2024 RBI MPC Meeting
Highlights of the Reserve Bank of India’s bi-monthly monetary policy, which was revealed on Friday, are as follows:
- The 6.5% repo rate remained constant.
- Since February 2023, the repo rate has remained unchanged.
- The position on monetary policy remains neutral.
- The FY25 GDP growth forecast dropped from 7.2% to 6.6%.
- FY25 GDP growth is expected to be 6.9% in Q1 and 7.3% in Q2.
- The estimated rate of inflation for FY25 is 4.8%.
- Inflation is expected to be 5.7% in Q3, 4.5% in Q4, 4.6% in Q1 FY26, and 4% in Q2.
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