On the basis of an assessment of the current and evolving macroeconomic situation
at its meeting, the Monetary Policy Committee (MPC) decided to:
- reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points
from 6.5 per cent to 6.25 per cent with immediate effect.
- Consequently, the reverse repo rate under the LAF stands adjusted to 5.75 per cent, and the
marginal standing facility (MSF) rate and the Bank Rate to 6.75 per cent.
- The decision of the MPC is consistent with an accommodative stance of monetary policy in
consonance with the objective of achieving consumer price index (CPI) inflation at 5 per cent
by Q4 of 2016-17 and the medium-term target of 4 per cent within a band of +/- 2 per cent,
while supporting growth. The main considerations underlying the decision are set out in the
statement below.
- The next meeting of the MPC is
scheduled on December 6 and 7, 2016 and its resolution will be announced on December 7.
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