The Reserve Bank of India on Friday raised the benchmark lending rate by 50 basis points, making it the fourth hike since May, to control the inflation.
The monetary policy Committee (MPC), comprising three members from the RBI and three external experts, raised the key lending rate or the repo rate to 5.90 per cent — the highest since April 2019 —with 5 out of 6 members voting in favor of the hike.
At a press conference after the RBI raised the lending rate, RBI Governor, Shaktikanta Das, said the apex bank was expecting inflation to come down close to the target of 4 per cent over a two-year period.
Das said the Monetary Policy Committee would meet to decide about writing a letter to the Government for not meeting the four per cent inflation target.
Asked about the contents of the letter they would write to the Government, the RBI Governor said it would be a privileged communication between the Apex Bank and the Government and the contents would not be made public or disclosed to anyone.
