RBI has done its part, solutions to external disruptions lie elsewhere

The MPC also reduced its inflation projection for this financial year from 3.7 per cent to 3.1 per cent, which is significantly lower than the target of 4 per cent

Analysts and economists in financial markets were debating over the past few weeks whether the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) will be in a position to reduce the policy repo rate further. A poll published by this newspaper earlier this week showed that some analysts expected the MPC to reduce the policy repo rate by 25 basis points in the August meeting. However, the six-member MPC on Wednesday unanimously decided to leave the policy rate unchanged at 5.5 per cent. The commentary accompanying this prudent decision clearly indicated that, as things stand, the committee