The Union Budget has been presented. Now all eyes are on the Reserve bank of India's MPC meeting. The Reserve Bank's bi-monthly meeting is this week, and the new Monetary Policy Committee, headed by newly appointed RBI governor Sanjay Malhotra, will meet tomorrow on february 4. The much-awaited repo rate will be announced on february 7. Further interest rates are expected to be cut. Investors are eagerly awaiting the RBI's announcement on february 7. The new Monetary Policy Committee, headed by new RBI governor Sanjay Malhotra, is set to hold important discussions from february 4. All eyes will be on the announcement on february 7, when governor Malhotra may announce a change in key rates. The Moneycontrol survey suggests that there are expectations for a 25 bps rate cut on february 7. That is, it could be reduced to 6.25 percent from the current 6.5 percent.
This is the first monetary policy meeting since Malhotra took office in december last year, after the term of Shaktikanta Das, who preceded him, ends on december 10, 2024. Despite the high expectations for a rate cut, the central bank has been taking important steps to increase liquidity. Last month, the Reserve bank announced measures to inject Rs 1.5 lakh crore into the liquidity. Earlier, in december last year, the central bank introduced liquidity of Rs 1.16 lakh crore due to a 50 bps cut in the repo rate.
RBI Monetary Policy 2025 Date and Time: The Reserve bank of India's Monetary Policy Committee (MPC) will meet from february 4 to february 7, and the official announcement on the repo rate will be made on february 7 at 10:00 AM. After the survey, governor Malhotra will address the media at 12:00 PM. He will discuss the reasons for the MPC decision, the current state of the indian economy, and his thoughts on the 2025 Union Budget. RBI Monetary Policy 2025: What happened in the last MPC?: In the last monetary policy meeting, the then RBI governor Shaktikanta Das kept the repo rate unchanged at 6.5 percent. However, the cash reserve ratio was reduced by 50 basis points. This was done to increase liquidity as Rs. 1 trillion was injected into India's banking system. Is the Reserve bank cutting interest rates?: With the central government focusing on increasing consumption in the country in the recent Union Budget, the Reserve bank is expected to help the government achieve its goal by reducing interest rates. Increasing consumption is considered necessary to accelerate the country's economic growth.
Economists who have analyzed the budget documents have estimated that the government is likely to receive a total of Rs 2.56 lakh crore in dividends from the Reserve bank and public sector banks. The government received a total of Rs 2.30 lakh crore in dividends in the last financial year 2024-25. The estimated amount this year could be even higher. Experts suggest that the depreciation of the rupee and profits from foreign currency assets could be the main reasons for this increase.
Inflation may remain at 4%: Economists believe that the inflation rate in terms of retail prices may come down to around 4% this year. In such a situation, the Reserve bank may take a big step by cutting policy rates. This is because the policies of the Reserve bank are aimed at supporting the economy instead of worrying about inflation. If necessary, they will not hesitate to reduce the repo rate. This year, in several stages, interest rates could fall by 1 percent!: Yes, the Reserve bank could cut interest rates by several points this year. Yes, the bank OF INDIA' target='_blank' title='reserve bank of india-Latest Updates, Photos, Videos are a click away, CLICK NOW'>reserve bank of india may cut interest rates by 1 percentage point at several points this year. This is expected to start from the RBI's bi-monthly meeting this month. This will reduce the EMI burden of the common man. rahul Bajoria, economist (India and Asia), bank of America Securities (BofA), and Karima Kapoor, economist, Elara Securities, have estimated that the RBI is expected to cut the repo rate by 0.25% in february to 6.25%. Then, it can gradually reduce the repo rate by another 0.75%, bringing it down to 5.50% by the end of 2025. The RBI is said to be able to increase money in the system by reducing the cash reserve ratio (CRR) by 0.50% or by buying securities from the open market.
RBI Monetary Policy 2025: What happened in the last MPC?: In the last monetary policy meeting, the then RBI governor Shaktikanta Das kept the repo rate unchanged at 6.5 percent. However, the cash reserve ratio was reduced by 50 basis points. This was done to increase liquidity as Rs. 1 trillion was injected into India's banking system.
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