The Reserve Bank of India will not change the repo rate in the upcoming monetary policy review. This has been estimated in a report. The report said the Monetary Policy Committee (MPC) could “adopt non-traditional policy measures to ensure financial stability.” The three-day meeting of the Monetary Policy Committee headed by the Governor of the Reserve Bank will begin on August 4. The results of the meeting will be announced on August 2.
Read more: EPF should be reduced by 12 per cent from August 1, find out other big changes
“We believe that the Reserve Bank will not cut rates in August,” SBI Research report-eCorp said. We believe that the MPC meeting will discuss other measures that can be taken to ensure financial stability in the current situation. The report said the repo rate has fallen 1.15 percent since February. Banks have offered customers a 0.72 per cent reduction on new loans. Some large banks have even transferred profits up to 0.85 percent.
Read more: What is the repo rate and how does it affect the general public?
This is because the Reserve Bank used liquidity as a means to achieve its policy goals, the report said. The report says that people prefer to hold on to financial assets during lockouts. It has encouraged financial savings in the country. The report said, “We anticipate that financial savings will increase in 2020-21. One of the reasons is to save people as a precautionary measure.