Inflation rate has come down to 4.59 percent
According to the government data for December 2020, the retail inflation rate has come down to 4.59 percent. The retail inflation rate in November 2020 was 6.93 percent. The RBI determines its main interest rate based on the retail inflation rate. Since inflation has come down, the expectation of a change in the interest rate is low. Currently, the Reserve Bank has adopted a policy of limiting retail inflation to an average of 4 per cent (with a scope of 2 per cent fluctuation) from 5 August 2016 to 31 March 2021.
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These are 6 members of the Monetary Policy Committee
The committee consists of 6 members, with three representing the government and three representing the RBI. These include Governor Shaktikanta Das. Among the representatives of the government are Ashima Goyal, Jayant R Verma and Shashank Bhide.
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Repo rate is 4 percent now
Presently, the repo rate of the Reserve Bank is 4 percent, which is historically low. Earlier this rate was changed on 22 May 2020. This change was made without the MPC meeting due to the Korena virus. Since February 2020, the RBI has cut the repo rate by a total of 1.15 percent. Sunil Kumar Sinha, Principal Economist and Director, India Ratings and Research, said that economic development is more important. Therefore, the repo rate is not expected to be increased.