RBI hikes repo rate by 40 basis points to 4.40 per cent

Reserve Bank of India (RBI) has hiked the policy repo rate by 40 basis points, taking it to 4.40 per cent. In a statement issued on Wednesday, the RBI said, based on an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting decided to increase the policy repo rate under the Liquidity Adjustment Facility (LAF) by 40 basis points to 4.40 per cent with immediate effect.

The statement further said, consequently, the Standing Deposit Facility (SDF) rate stands adjusted to 4.15 per cent and the Marginal Standing Facility (MSF) rate and the Bank Rate to 4.65 per cent.

The MPC also decided to remain accommodative while focusing on withdrawal of accommodation to ensure that inflation remains within the target going forward while supporting growth. It said, these decisions are in consonance with the objective of achieving the medium-term target for Consumer Price Index (CPI) inflation of four per cent within a band of /- two per cent, while supporting growth.