The burden of high EMI is not alleviated. The 6.50 percent policy rate has been sustained by the Reserve Bank of India. This declaration was issued by RBI Governor Shaktikanta Das by the resolution reached in the RBI Monetary Policy Committee meeting. Five of the Monetary Policy Committee’s six members, according to the RBI Governor, voted against lowering the repo rate. The RBI has not changed the repo rate even though in July and August the retail inflation rate fell below its 4 percent tolerance zone.
Inflation risk is posed by global tensions.
In his address, the RBI governor noted that global tensions remain the biggest risk to inflation. The sudden increase in the cost of food and metals presents a risk to retail inflation. He said core inflation has increased in July and August and retail inflation is likely to rise sharply due to the base effect. The RBI governor has projected retail inflation to be 4.5 percent for 2024-25. At the same time, inflation is estimated to be 4.1 percent in the second quarter of the current financial year, 4.8 percent in the third quarter, and 4.2 percent in the fourth quarter.
The RBI did not provide relief from high-priced EMI.
Ashwani Rana, the founder of Voice of Banking and a banking expert, stated that the Reserve Bank has not altered the repo rate for the fifth time in 2024. Despite its ongoing attempts to rein in inflation, the Reserve Bank reports that food inflation has risen above goal. It has therefore chosen to maintain the repo rate at 6.50 percent. He claimed that the bank clients who were hoping for a decrease in the repo rate had been let down. It was believed that the Reserve Bank would alter the repo rate and make a gift following the Federal Reserve’s interest rate cut to those paying expensive EMIs before the festivals. But this has not happened.
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