MUMBAI, October 5 — The six-member Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) advanced through its second day of intensive bi-monthly policy deliberations at the central bank's Mint Street headquarters in Mumbai, with financial markets positioning ahead of the policy resolution statement scheduled for October 7.
Deliberations centered on systemic liquidity conditions, the balance of domestic economic growth, and the persistence of non-food core inflation metrics against recent cross-border monetary easing cycles led by the US Federal Reserve. While arriving kharif harvests have tempered headline retail food prices, ongoing Middle Eastern logistics frictions and energy volatility have reinforced institutional arguments for keeping the benchmark policy repo rate anchored at 6.50% alongside a stance focused on withdrawal of accommodation.
The RBI Governor will address the national media on the morning of October 7 to announce the MPC's voting breakdown, growth forecasts (pegged near 7.2% for FY27), and updated quarterly headline inflation projections.
Monetary policy tools, the Liquidity Adjustment Facility (LAF) corridor, Standing Deposit Facility (SDF), and statutory inflation-targeting bands (4% with a +/- 2% tolerance band) are foundational subjects in UPSC GS Paper III (Indian Economy) and RBI Grade B examinations. Candidates should remember that the MPC was established under Section 45ZB of the Reserve Bank of India Act, 1934, following the recommendations of the Urjit Patel Committee in 2014.