RBI hikes key lending rate by 50 bps to 5.9 pc to quell inflation

The Reserve Bank of India (RBI) on Friday announced an increase in the policy repo rate by 50 basis points to 5.9%. The Monetary Policy Committee (MPC) of the RBI hiked the repo rate with immediate effect.

RBI Governor Shaktikanta Das made the announcement about the hike today which is aimed to subdue the inflation.   

"Standing Deposit Facility(SDF) rate stands adjusted to 5.65% &MSF(Marginal Standing Facility) and bank rate to 6.15%. Monetary Policy Committee (MPC) decided to remain focused on withdrawal of accommodation to ensure inflation remains within target going forward, supporting growth," Das said.

"Inflation projection is retained at 6.7% for current year, with Q2 at 7.1%, Q3 at 6.5% & Q4 at 5.8% with risks evenly balanced. CPI inflation is projected to further reduce to 5% in Q1 of FY 2023-24. Monetary policy must remain alert and nimble," he added.