RBI Governor Shaktikanta Das announced on Friday that the Monetary Policy Committee had voted unanimously to keep the repo rate unchanged at 4 per cent.
Das made the announcement on the sidelines of the bi-monthly monetary policy review.
Experts had expected that stubborn retail inflation, which has remained above the comfort level of the RBI of around 4 per cent, would refrain the central bank from reducing interest rate.
In its October monetary policy statement, the RBI had said the real GDP growth in 2020-21 was expected to be negative at (-) 9.5 per cent, with risks tilted to the downside: (-) 9.8 per cent in Q2:2020-21; (-) 5.6 per cent in Q3; and 0.5 per cent in Q4.
According to the Finance Ministry’s Monthly Economic Review, the year-on-year GDP contraction of 7.5 per cent in Q2 of 2020-21 underlies a quarter-on-quarter surge in GDP growth of 23 per cent. This V-shaped recovery, evident at the half-way stage of 2020-21, reflects the resilience and robustness of the Indian economy.