Fourth Bi-monthly
Monetary Policy Statement, 2016-17
Resolution of the
Monetary Policy Committee (MPC), Reserve Bank of India
On the basis of an
assessment of the current and evolving macroeconomic situation at its meeting today,
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.
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