Key points from RBI Governor's speech:

* The key lending rate of the RBI or the repo rate was left unchanged at 4 per cent.

* The reverse repo rate or the key borrowing rate stayed at 3.35 per cent.

* GDP projected at (-) 7.5 per cent for the current year as against earlier projection of (-) 9.5 per cent.

MUMBAI: The Reserve Bank of India (RBI) today maintained an accommodative stance and decided to leave the key policy rate, the repo rate, unchanged at 4 per cent. While the reverse repo rate or the key borrowing rate stayed at 3.35 per cent. This is the third time in a row that the apex bank of the country has kept the key rates unchanged.

Announcing the policy review, RBI governor Shaktikanta Das said, “On the basis of an assessment of the current and evolving macroeconomic situation, RBI's Monetary Policy Committee (MPC) at its meeting today decided to continue with the accommodative stance as long as necessary (at least during the current financial year and into the next financial year) to revive growth on a durable basis and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.”

Das said that the Indian economy was recovering faster than expected from the slump created by the Covid-19 pandemic and raised the Gross Domestic Product (GDP) projection for financial year 2021 to (-)7.5 per cent from (-)9.5 per cent earlier. "RBI is strongly committed to preserve the stability of the financial sector and will do whatever is necessary on this front," Das added.

The RBI Governor said the signs of recovery are far from being broad based and are dependent on sustained policy support and added that further efforts are necessary to mitigate supply side driven inflation pressures.

Financial experts have welcomed the RBI's stance and said the apex bank's stance was on expected line, considering that latest inflation data showed that retail inflation was rising, it rose to 7.61 per cent in October which was the highest since May 2014. The stock markets have given a rousing reaction to the policy with the key indices hitting all time high.

Commenting on the policy statement, Abheek Barua, Chief Economist at HDFC Bank said, "The RBI kept its policy rate unchanged at 4 per cent, as expected, and continued to keep its policy stance accommodative."

Dr. Sangita Reddy, Joint MD of Apollo Hospitals Enterprises president of Federation of Indian Chambers of Commerce & Industries, FICCI said, “It is heartening to see RBI confirming that it will maintain an accommodative stance till the time necessary for stabilizing growth on a firm footing. While the inflation trajectory has moved up, at this point in time re-energizing growth should get all the attention."