MONETARY POLICY STATEMENT

Dec. 6, 2018

The Monetary Policy Committee (MPC) issued its Fifth bi-monthly Statement on the basis of its assessment of the current and evolving macroeconomic situation.

About:

It has maintained status quo on all key policy rates.
- The RBI has kept the Marginal Standing Facility Rate and the Bank Rate at 6.75 %.
- The Repo Rate remains unchanged at 6.5 % and the Reverse Repo Rate at 6.25 %.
- The MPC has, however, retained its stance of ‘calibrated tightening’.
RBI has lowered its inflation forecast based on moderation in food inflation and sharp decline in international crude oil prices. Inflation is projected to be in the range of 2.7 to 3.2 % in the second half of this fiscal.
On the growth front, RBI retained GDP growth rate projection at 7.4 % for this fiscal.
The RBI has also decided to reduce SLR from existing 19.5% to 18.0% in six quarterly instalments beginning January 2019. This will have some implications for the Government securities.