RBI can give relief for the second time in a row, the problem of rising interest rates will not come!

To control inflation, the central bank of India has seen an increase of 250 basis points i.e. 2.50 percent in the repo rate from May 2022 to February 2023. After which the repo rate became 6.50 percent.

The Reserve Bank of India can once again give great relief to the people of the country. This relief is from rising interest rates. Yes, RBI's monetary policy meeting is going to be held this week. This meeting will be held from 6 to 8 June. On June 8, RBI will announce the MPC policy rate. According to experts, this time there is no possibility of any change in the policy rate. In fact, inflation is less than the tolerance level of RBI. Retail inflation was at an 18-month low in the month of April. At the same time, retail inflation is expected to remain below 5 percent in May as well. In such a situation, it is expected that RBI will neither increase nor cut interest rates.

250 basis point increase in one year

Earlier, due to the Russia-Ukraine war, global commodity prices had increased. Because of which inflation had increased in the whole world including India. To control inflation, the central bank of India has seen an increase of 250 basis points i.e. 2.50 percent in the repo rate from May 2022 to February 2023. After which the repo rate became 6.50 percent. In the month of April, the RBI MPC did not make any change in the interest rates. This time also the same is expected.

Inflation is coming down

In the months of March and April, the figures of inflation were less. If we talk about April, the country's retail inflation came down from 5 percent to 4.7 percent, which was the lowest level in 18 months. While a year ago retail inflation was at 7.8 per cent. At the same time, the figures of wholesale inflation have also come down significantly. RBI has kept the target of retail inflation at 4 to 6 percent. The country's retail inflation is below the upper band of 6 per cent in both the months of March and April.

What do experts say

According to Radhika Rao, Senior Economist, DBS Bank India, strong GDP figures may give RBI another pause in interest rates in June. Rao says that although there may be a unanimous decision on keeping the MPC rates unchanged, the future may see a change in opinion on the hawkish stance. Economists at HSBC expect that the RBI will not make any change in interest rates this time. It is expected that interest rates will be cut in the early months of next year. Earlier, the MPC had cut the repo rate by 115 basis points to a record 4 per cent to boost economic growth during the pandemic.