Raise rate by 25 bps, economists tell RBI

But say liquidity stance should be flexible at Apr 3-6 meet

- BHASKAR DUTTA

At a meeting on Monday with senior officials of the Reserve Bank of India (RBI), economists suggested that the central bank raise the repurchase, or repo, rate by 25 basis points (bps) at its next policy review, which begins on April 3, as the prevailing dynamics of domestic growth and inflation warrant more tightening.

The Monetary Policy Committee will release its statement on April 6. The repo rate is the interest rate at which the RBI lends money to commercial banks.

While the MPC's next meeting comes amid the turmoil in the global banking sector, sparked by the collapse of the US-based Silicon Valley Bank and the takeover of Swiss lender Credit Suisse, economists pointed out that other central banks had opted to press ahead with rate hikes to combat inflation.