Agencies

RBI Monetary Policy: RBI maintains status quo third time in a row, keeps Repo Rate unchanged at 4%
04-December-2020

The Reserve Bank of India's Monetary Policy Committee on Friday kept its benchmark policy rate unchanged as inflation remained above its target even though the economy continued to contract. RBI maintained status quo for the third time in a row and kept the benchmark lending rate unchanged at 4 per cent, Governor Shaktikanta Das announced.

Addressing the media, RBI Governor Shaktikanta Das said, "Monetary Policy Committee (MPC) was of the view that inflation is likely to remain elevated with some relief in the winter months from prices of perishables and bumper Kharif arrivals."

Monetary Policy Committee (MPC) voted unanimously to keep the policy repo rate unchanged at 4 per cent. The committee, which has cut rates by 115 basis points since the Covid-19 crisis hit in March, has kept rates on hold since May.

"RBI keeps Repo Rate unchanged at 4%. It has maintained "Accommodative" stance," Das said.

The Marginal Standing Facility (MSF) rate and the bank rate remain unchanged at 4.25%. The reverse repo rate remains unchanged at 3.35%, Shaktikanta Das added.

The central bank maintained the accommodative stance for this year and next.

"MPC decided to continue with accommodative stands of monetary policy as long as necessary, at least till current financial year & into next year to revive growth on a durable basis & mitigate the impact of COVID-19 while ensuring that inflation remains within target, " RBI Governor added.

RBI also tolf commercial and co-op banks not to declare dividend for FY21. "Commercial Banks will not give out dividends this year and retain all the profits, the governor said,"Das added.