MUMBAI, October 7 — The Monetary Policy Committee (MPC) of the Reserve Bank of India on Wednesday concluded its bi-monthly review, voting unanimously to maintain the benchmark policy repo rate unchanged at 6.50 percent while decisively shifting the policy stance from 'withdrawal of accommodation' to 'neutral' by a 5:1 majority.
Delivering the post-meeting statement, RBI Governor Shaktikanta Das announced that the Standing Deposit Facility (SDF) rate remains calibrated at 6.25 percent, while the Marginal Standing Facility (MSF) and Bank Rate stand at 6.75 percent. The central bank retained its real GDP growth projection for FY27 at a robust 7.2 percent, maintaining the full-year CPI headline inflation estimate at 4.5 percent, anticipating that kharif harvest arrivals will dampen seasonal food price volatility.
Governor Das emphasized that pivoting to a 'neutral' stance provides the monetary panel with bilateral operational flexibility to respond dynamically to incoming macroeconomic indicators while sustaining systemic liquidity. The central bank underlined that anchoring medium-term inflation expectations precisely to the 4.0 percent statutory target remains the enduring objective, even as core manufacturing inflation registers sustained stability.
The operational parameters of the Liquidity Adjustment Facility (LAF) corridor, the mechanics of the Standing Deposit Facility (SDF), transmission elasticity of policy rates, and the statutory architecture under the RBI Act 1934 form core components of the RBI Grade B and UPSC Civil Services (GS-III: Indian Economy) syllabi. Candidates should note that the SDF was formally operationalized in April 2022 as an uncollateralized liquidity absorption window, replacing the traditional fixed-rate reverse repo as the operative floor of the LAF corridor.