The Reserve Bank of India (RBI) Governor, Shaktikanta Das, recently made a major announcement regarding the country's monetary policy. He revealed that the repo rate, which is the rate at which the central bank lends money to commercial banks, has been increased by 25 basis points to 6.5%.

In his statement, Das acknowledged the challenges faced by emerging market economies, including the need to support economic activity while maintaining control over inflation and preserving policy credibility. Despite these difficulties, he noted that the global economic outlook has improved in recent months, with growth prospects for major economies on the rise and inflation on a downward trajectory.

According to Das, inflation is expected to average 5.6% in the fourth quarter of 2023-24. The RBI has also projected a GDP growth rate of 6.4% for the 2023-24 financial year.

In conclusion, the increase in the repo rate by the RBI is a reflection of the delicate balance that must be maintained between economic growth and inflation control. The announcement by Governor Das highlights the importance of monitoring economic indicators and adjusting monetary policy accordingly to ensure the stability of the country's financial system