Charts: RBI holds repo rate at 6.5% as inflation rears its head

RBI Governor Raghuram Rajan today kept the key policy rate unchanged citing higher upside risks to 'inflation trajectory' but said the central bank will remain accommodative provided data are supportive.

Reuters

Reuters

Accordingly, Rajan retained the short-term lending rate at 6.5 and the cash reserve requirement of banks at 4 per cent.

"The inflation surprise in the April reading makes the future trajectory of inflation somewhat more uncertain... rising crude prices and implementation of the seventh pay commission awards being the key risks," Rajan said in the second bimonthly monetary policy for the current fiscal.

Explaining the rationale for keeping the rates unchanged, Rajan said: "Incoming data since the April policy announcement show a sharper-than-anticipated upsurge in inflationary pressures emanating from a number of food items (beyond seasonal effects), as well as a reversal in commodity prices."

RBI--repo-rate

With PTI


Updated Date: Jun 07, 2016 12:56 PM

Also Watch

Watch: Firstpost test rides the new Thunderbird 500X in Goa and walks you through the Royal Enfield Garage Cafe
  • Tuesday, April 17, 2018 Varun Dhawan on Shoojit Sircar's October, 5-star reviews and working with Anushka Sharma in Sui Dhaaga
  • Saturday, April 14, 2018 Ambedkar Jayanti: Re-visiting Babasaheb's ideals exposes fake Dalit politics of Rahul Gandhi and Congress
  • Monday, April 9, 2018 48 hours with Huawei P20 Pro: Triple camera offering is set to redefine smartphone imaging
  • Monday, April 16, 2018 Rajyavardhan Singh Rathore interview: Sports can't be anyone's fiefdom, we need an ecosystem to nurture raw talent

Also See