MPC unlikely to begin rate cuts now

MUMBAI: Despite the rising chorus within the monetary policy committee (MPC) for slashing the interest rates and also change the policy stance, nobody is expecting the Reserve Bank-led rate setting panel to tweak the policy rates or even the stance because of the still stubborn inflation.

If the MPC, which began its three-day customary pre-policy review meeting on Tuesday here, leaves the rates unchanged, this will be the ninth consecutive time it does so, after it raised the key repo rate by 35 bps to 6.5% in the February 2023 review.

Two of the six-member MPC in the last policy meet in June had differed with the majority view to hold the rates as well as to retain the policy stance of withdrawal of accommodation. Jayant Verma and Ashima Goel are two of the three external members of the panel and are appointed by the government.