MUMBAI: Majority of the members of the Monetary Policy Committee (MPC) favoured raising interest rate saying that it would be hasty to ease vigil against inflation while some voted for a pause as tighter monetary policy poses risk to economic growth.
The minutes of the February 6-8 MPC meeting released by the Reserve Bank of India (RBI) on Wednesday showed external members Jayanth Varma and Ashima Goyal were not in favour of raising rates any further, while Shashanka Bhide sided with the three Reserve Bank members and voted for raising the key policy rate for the sixth time in a row.
The MPC, headed by RBI Governor Shaktikanta Das, raised the repo rate by 25 bps to 6.5% from 6.25% taking the total quantum of rate hikes since May 2022 to 250 bps. “We must, therefore, remain unwavering in our commitment to bring down inflation to ensure a decisive and durable moderation in inflation towards the target of 4% over the medium term, while being mindful of growth,” said Das.