The Monetary Policy Committee (MPC) on December 8 retained the key lending rate, repo, at 4 percent, and maintained its stance as "accommodative". Repo is the rate at which the Reserve Bank of India lends short-term funds to banks.
This is the ninth consecutive policy meeting where the rate setting panel has maintained the key lending rate. The MPC has also maintained the reverse repo rate at 3.35 percent and the MSF rate at 4.25 percent. The announcement came in the context of fresh threats from the Omicron variant. So far, India has reported over two dozen Omicron cases.
This has forced several states to impose fresh travel restrictions. There is a fear that the Omicron surge will lead to a third wave of Covid-19 in the country.
The RBI has retained its GDP growth projection at 9.5 percent for FY22, but revised Q3FY22 growth estimate to 6.6 percent from 6.8 percent earlier.
