New Delhi/Mumbai, June 04 (H.S.): The Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) is convening for a three-day meeting starting today in Mumbai, with outcomes expected on June 6. This meeting occurs amid a steady decline in inflation, with India's retail inflation dropping to 3.16% in April from 3.34% in March. The MPC is likely to consider this decrease when deciding on policy interest rates. Reports suggest that the RBI may announce a 50 basis points (bps) cut in the repo rate, aimed at reviving the credit cycle and supporting economic growth. SBI's analysis notes that the overall rate cut during this easing cycle could total 100 bps, anticipating a significant cut in the June meeting.

Previously, at the MPC meeting in April, the RBI had cut the repo rate by 25 bps from 6.25% to 6%, following a similar reduction in February. RBI Governor Sanjay Malhotra had indicated that these decisions were made after thorough evaluations of macroeconomic conditions. With two consecutive cuts already implemented and inflation continuing to decline, there is heightened speculation among markets and economists about the possibility of a more substantial rate cut this time around. The outcome of this meeting will be closely monitored as it could have significant implications for the economy’s recovery and growth trajectory.

Hindusthan Samachar / Jun Sarkar