RBI Keeps Repo Rate Unchanged, Slashes Growth Projection By 1%

The Reserve Bank of India on Thursday lowered the Gross Domestic Product growth rate forecast from 6.1% from 5%.

This came at a time when India’s economy is faltering. Figures released last week showed that Gross Domestic Product growth slumped to a six-year low in October even as industrial output contracted. In the last few months, core sectors such as automobiles and manufacturing have witnessed a progressive slowdown because of weakened consumer demand and dearth of investments.

However, the top bank kept interest rates unchanged. The repo rate, or the interest rate at which it lends to commercial banks, will remain 5.15%. The reverse repo rate is unchanged at 4.90%. The reverse repo rate is the rate at which the central bank borrows money from commercial banks.