RBI changes stance to calibrated tightening; key takeaways from policy meet

With the actual retail inflation coming below RBI's projections in the last two months, the rate pause in October 2018 is not altogether unexpected

Springing a surprise, the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) on Friday kept the repo rate unchanged at 6.50 per cent. Most analysts had expected the central bank to hike rates by 25 bps.

The repo rate is the rate at which the central bank lends money to commercial banks in the event of any shortfall in funds.

Giving the rationale behind RBI's move, Sujan Hajra, Chief Economist at Anand Rathi Financial Services, said, "With the disturbances in the money/debt market sparked off by IL&FSs default on debt, RBI has initiated numerous liquidity easing measures including aggressive