Meeting of the RBI Monetary Policy Committee (MPC): The RBI Monetary Policy Committee (MPC) will begin its three-day meeting on April 3 and conclude on April 5, during which it will discuss interest rates and examine the status of the economy. This will be the RBI MPC’s first meeting following the April 1 start of the new fiscal year, FY2025, and its second meeting in 2024 following the February Policy meeting, which took place from February 6–8. Given the recent spike in GDP numbers, many economic observers will be closely monitoring the RBI’s tone, even though the majority of the street anticipates the status quo on rates.
Date of the RBI Monetary Policy Meeting
On April 5, at 10 a.m., the RBI will make its announcement regarding interest rates following its meeting on monetary policy. At the conclusion of its three-day meeting, the Monetary Policy Committee always makes an announcement. June 5 is set aside for the next RBI MPC meeting. A minimum of four meetings of the MPC are mandated annually.
Meet the members of the RBI MPC.
The government forms the six-member Monetary Policy Committee (MPC) in accordance with Section 45ZB of the amended RBI Act, 1934. Members of the current committee, which was established on October 5, 2020, are:
1. Governor of the Reserve Bank of India as Chairperson
2. Member: Reserve Bank of India Deputy Governor, in charge of Monetary Policy
3. Member: A single Reserve Bank of India representative chosen by the Central Board
4. Professor Ashima Goyal from the Indira Gandhi Institute of Development Research is the fourth member.
5. Member: Indian Institute of Management, Ahmedabad Professor Jayanth R. Varma
6. Participant: Senior Advisor Dr. Shashanka Bhide of the National Council of Applied Economic Research, Delhi
Each MPC member is entitled to one vote; if there is a tie for votes, the governor may cast a second or deciding vote.
What is the role of the RBI MPC?
In addition to monitoring the state of the economy overall and the liquidity situation, the Monetary Policy Committee, or MPC, of the Reserve Bank of India, sets the policy repo rate needed to meet the inflation target.
What is expected of the RBI MPC?
It is anticipated by those on the other side of the street that the RBI will likely maintain rates at 6.50 percent. The RBI’s MPC had previously determined in the February Policy to keep concentrating on the removal of accommodation in order to guarantee that inflation gradually approaches the target while promoting growth. Incorporating its evaluation of the economy, the RBI declared that “any indications of the expansion of food price pressures to non-food prices will be closely observed by MPC, as this could jeopardize the progress made in reducing core inflation.”
“Monetary policy must remain actively disinflationary to ensure anchoring of inflation expectations and fuller transmission,” the statement continued. The MPC will not waver in its determination to bring inflation into line with the goal. The MPC also made the decision to keep its attention on the removal of accommodation in order to support growth while ensuring that inflation gradually approaches the target.
Please be reminded that core inflation decreased in February to 3.34 percent from 3.59 percent in January. The headline CPI inflation rate did not change from 5.1% in January to 5.9% in February, though.
According to a March report from UBS, there doesn’t seem to be a pressing need for an immediate rate cut. “We think there is no urgency for the MPC to change policy settings (rates and stance) in the April policy,” noted Tanvee Gupta Jain, an economist at UBS India. We anticipate that the June policy will most likely see the change in policy stance to “neutral.”
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