RBI hikes repo rate by 25 basis points; reverse repo revised to 6 %

New Delhi: The Reserve Bank of India (RBI) on Wednesday hiked the repo rate and reverse repo rate at 6.25 percent and 6 percent respectively.

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Maintaining a neutral stance, the central bank's six-member Monetary Policy Committee (MPC), in its Monetary Policy Statement reiterated its commitment to achieving the medium-term target for headline inflation of 4 percent on a durable basis.

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"GDP growth is projected in the range of 7.5-7.6 percent in H1 and 7.3-7.4 percent in H2, with risks evenly balanced," stated the Monetary Policy statement.

Following this, the MPC maintained neutral stance in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 percent within a band of +/- 2 percent, while supporting growth. MPC added that the crude oil prices have been volatile recently and this imparts considerable uncertainty to the inflation outlook, both on the upside and the downside.

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Meanwhile, the committee said adherence to budgetary targets by the Centre and States appears to ease upside risks to the inflation outlook considerably. (ANI)

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