MPC minutes: Frontloaded rate aimed to support growth, faster transmission

RBI's MPC voted 5:1 for a 50 bps rate cut in June to spur growth and boost credit amid benign inflation, with members supporting a shift to a neutral policy stance

The large cut of 50 basis points (bps) in policy repo rate during the June meeting of the Reserve Bank of India’s (RBI’s) Monetary Policy Committee (MPC) was aimed at faster transmission and lifting economic growth at a time when inflation outlook remained benign, MPC members said, according to the minutes released on Friday.

 

The six-member rate-setting panel voted 5:1 in favour of 50 bps rate cut to 5.5 per cent. While there was no voting on stance, as it was not required by the statute, all members favored change to “neutral” from “accommodative”.

 

RBI Governor Sanjay Malhotra