Source: Odisha tv
Reserve Bank of India prepares to announce decisions taken by its Monetary Policy Committee. This is the first monetary policy announcement after the presentation of the Union Budget 2021-22. The current repo rate i.e. the rate at which RBI lends to banks is at a record low of 4 per cent. The reverse repo rate which is the rate for funds parked by banks with RBI is 3.35 per cent.
RBI’s MPC will announce where interest rates are headed to from here. The move gains significance this time as earlier this week the central government unveiled its massive borrowing plan. Economists expect the MPC to continue holding the repurchase rate at 4%. The 10-year bond yield has gone up from 5.93% a day ahead of the Union Budget to 6.08%. The MPC cut interest rates by 115 basis points last year to maintain liquidity in the financial system but has maintained the status quo for the last three meetings.