RBI’s MPC starts discussion on key interest rate, decision on Oct 1

OUR CORRESPONDENT

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The Reserve Bank’s Monetary Policy Committee began its three-day deliberations amid expectations of status quo on the key interest rate, but some experts think that the central bank may settle for a 25 bps cut.

The decision of the RBI Governor Sanjay Malhotra-headed six-member rate-setting panel will be announced on Wednesday.

The meeting is taking place against the backdrop of ongoing geopolitical tensions and the US imposing 50 per cent tariffs on Indian shipments.

The RBI reduced the key short-term lending rate (repo) by 100 basis points in three tranches, beginning in February, amid declining consumer price index (CPI) based inflation.

However, the central bank opted for a status quo in the August bimonthly monetary policy, taking a wait-and-watch approach to assess the impact of US tariffs and other geopolitical developments on the domestic economy.