RBI policy: Repo rate hiked by 50 bps to 5.9%; FY23 GDP forecast cut to 7%

CPI inflation for the current financial year is seen at 6.7%, with the price gauge seen at 7.1% in July-September

The Reserve Bank of India (RBI)’s Monetary Policy Committee (MPC) announced a 50 basis points (bps) hike in the repo rate to 5.90 per cent on Friday in order to bring elevated inflation back to its target.

"Consequently, the standing deposit facility (SDF) rate is now at 5.65 per cent and the marginal standing facility (MSF) rate at 6.15 per cent", RBI Governor Shaktikanta Das said. The SDF is the lower band of the interest rate corridor and the MSF the higher.

The MPC also retained its current stance of remaining focused on the withdrawal of accommodation, Das said. The