Analysts Predict Steady Repo Rate Amidst Market Fluctuations and Global Economic Trends
The Reserve Bank of India (RBI) is set to convene its first Monetary Policy Committee (MPC) meeting for the fiscal year 2024-25 from April 3 to April 5, 2024. Led by RBI Governor Shaktikanta Das, the MPC will announce its decision on April 5 at 10 am, marking a crucial moment for economic stakeholders and market participants alike.
Outlined are the dates for the upcoming MPC meetings:
- April 3-5, 2024
- June 5-7, 2024
- August 6-8, 2024
- October 7-9, 2024
- December 4-6, 2024
- February 5-7, 2025
As anticipation builds, analysts foresee the RBI maintaining the repo rate at its current level of 6.5 percent, a stance that has been upheld since February 2023. However, the volatile nature of markets may persist, particularly affecting interest rate-sensitive stocks, thus necessitating careful monitoring.
The RBI’s primary objective remains the alignment of India’s inflation with its predefined target, which is being influenced by the dovish stance of the US Federal Reserve. While economists largely anticipate a status quo in the repo rate, opinions diverge on the potential timing of rate adjustments in 2024.
Despite the prevailing uncertainties, market sentiment is expected to stay positive, with traders advised to concentrate on large-cap stocks and resilient sectors to capitalize on potential opportunities amidst the economic landscape.
Reflecting on the previous MPC meeting held in February 2024, the committee opted to maintain the benchmark interest rate unchanged at 6.5 percent for the sixth consecutive session. This decision was rooted in concerns regarding inflation, with a majority of members favoring the status quo on the policy rate.
Emphasizing a gradual withdrawal of accommodation, the MPC reiterated its commitment to aligning inflation with the target while bolstering economic growth. Key rates, including the Fixed Reverse Repo Rate at 3.75 percent and the bank rate at 6.75 percent, remained unchanged.
In conclusion, the upcoming MPC meeting holds significant importance as stakeholders keenly observe the central bank’s strategies in navigating the evolving economic dynamics.
