Repo rate one of many factors to revive growth: MPC Member Nagesh Kumar

In particular, there was a concern about the weaknesses of the manufacturing sector, which is important for job creation due to subdued urban consumption & slow growth of private investments, he said

After a gap of almost five years, the Reserve Bank of India’s (RBI’s) monetary policy committee (MPC) lowered the policy repo rate during the February meeting. MPC member NAGESH KUMAR discusses the rate cut rationale and the future rate trajectory in an email interview with Manojit Saha.

 

What is the rationale behind the repo rate cut? 

The backdrop for the MPC decision to cut the repo rate by 25 basis points was provided by the need to support economic growth momentum and the elbow room provided by the moderation of inflationary pressures. The NSO’s First Advance Estimates put the economic