February MPC Decision: A refraining act
08-Feb-2024
In the February MPC
policy, both repo rate and stance have been left unchanged. RBI sounded
cautious and reiterated its focus on inflation targeting. Also, RBI
clarified that stance need to be seen in the light of incomplete transmission of
rate increase and inflation ruling above 4% mark. With falling inflation,
the real rate of interest has headed higher (both in US and domestically), and
any pivot will now depend on Central Banks' assessment of the required real
rate of interest.