Indian The 3-day long meeting of the Monetary Policy Committee (MPC) of the Reserve Bank started on Monday. This is the first bi-monthly monetary review meeting of the current financial year. This meeting is taking place at a time when there is a possibility of keeping the repo rate unchanged at 5.25 percent amid fears of rising inflation due to the West Asia crisis. The decision of the 6-member Monetary Policy Committee (MPC), headed by Reserve Bank Governor Sanjay Malhotra, will be announced on Wednesday, April 8.
The repo rate was last reduced in December 2025
RBI has reduced the policy rate repo by a total of 1.25 percent since February 2025. This is the biggest cut since 2019. RBI last cut the repo rate by 0.25 percent in December last year. The last meeting was held in February and no change was made in the repo rate in that meeting. According to experts, MPC members will take into account the ongoing tensions in West Asia, volatility in commodity prices and fluctuations in the value of the domestic currency. He said retail inflation has come close to the RBI’s medium-term target of 4 per cent, but the recent rise in global crude oil prices has raised concerns about the impact on domestic prices.
Crude oil prices crossed 100 dollars
According to an estimate, an increase of $10 per barrel in crude oil prices increases inflation by 0.60 percent. The Reserve Bank has the responsibility of keeping retail inflation at 4 percent with a variation of 2 percent. Crude oil prices were around US$60 per barrel for a long time. Crude oil prices have risen to more than $100 per barrel since the conflict began in the Middle East on February 28.
Indian currency declined by more than 4 percent
Additionally, the value of the Indian currency has fallen by more than 4 percent since the war, which has also impacted imported inflation. Experts also believe that the central bank will maintain its current neutral stance in the upcoming review, reflecting its preference to maintain stability amid changing inflation conditions and global uncertainties.
SK Sharma is a content writer who writes on news, entertainment, and lifestyle topics. She has over four years of experience and is known for conveying information in simple and clear language.
