The Reserve Bank of India (RBI) for the third time in a row maintained the status quo due to the persistently high inflation and a lower-than-expected narrowing of the economy. The banking regulator kept the Repo Rate unchanged at 4 percent and reverse repo rate at 3.35 percent.
The Repo Rate was last changed by the Monetary Policy Committee (MPC) of the Reserve Bank of India on May 22. It maintained the status quo on the benchmark lending rates in view of persistently high inflation and a lower-than-expected contraction of the economy.
Today, the central bank announced that the commercial and co-operative banks to not offer dividends this year and hold all the profits. RBI’s Governor Shaktikanta Das also said that RBI will introduce risk-based internal audits for urban co-operative banks.
The three-day RBI bi-monthly policy is ongoing Wednesday and the conclusion of the six-member MPC headed by the governor has been announced today.
The Governor also said that on-tap TLTRO will be expanded in a bid to cover other stressed segments in conjunction with Emergency Credit Line Guarantee Scheme (ECLGS).
He also said that the real GDP growth for 2021 is projected at -7.5%.