MUMBAI: Announcing the bi-monthly policy, the Reserve Bank of India (RBI) Governor Shaktikanta Das today said that it was continuing the accommodative stance, as it kept the key rates unchanged for fourth time in a row.

Das said that the Monetary Policy Committee (MPC) which met on 3rd, 4th and 5th February, deliberated on current and evolving macroeconomic and financial developments, both domestic and global and voted unanimously to leave the policy repo rate unchanged at 4 per cent and reverse repo at 3.35 per cent respectively.

Since the reverse repo rate will continue to earn 3.35 per cent for banks for their deposits kept with the RBI, banks are likely to keep their interest rates on fixed deposit (FD) unchanged for the time being.

Similarly for borrowers like home loans on floating basis which are linked with an external benchmark. i.e., repo rate, (called as repo linked lending rate or RLLR by banks) they are not likely to see any negative changes as of now.

Das said, "RBI has decided to continue with accommodative stance as long as necessary, at least through the current financial year and into the next year, to revive growth on a durable basis and mitigate the impact of COVID-19."

RBI has projected the GDP growth rate for 2021-22 at 10.5% and said that the Indian economy is poised to move in only one direction and that is upwards. Supporting the argument Das said that the Union Budget 2021-22 has provided a strong impetus for revival of sectors such as health, infrastructure etc., and this will have a cascading multiplier effect going forward, particularly in improving the investment climate and reinvigorating domestic demand, income and employment.

RBI also gave a stable near term outlook for inflation. As per Das, after breaching the upper tolerance threshold continuously since June 2020, CPI inflation moved below 6 per cent in December for the first time in the post-lockdown period. This he said was supported by favorable factors like sharp fall in key vegetable prices.