India Interest Rate  2000-2017 | Data | Chart | Calendar | Forecast | News

The Reserve Bank of India lowered its benchmark interest rate by 25bps to 6 percent on August 2nd 2017, in line with market expectations. It is the first rate cut so far this year, bringing borrowing cost to the lowest since 2010 amid a sharp slowdown in inflation. The reverse repo rate was also lowered by 25bps to 5.75 percent and the marginal standing facility rate and the Bank Rate to 6.25 percent. Interest Rate in India averaged 6.69 percent from 2000 until 2017, reaching an all time high of 14.50 percent in August of 2000 and a record low of 4.25 percent in April of 2009.

India Interest Rate
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India Cuts Key Rate to 6%


The Reserve Bank of India lowered its benchmark interest rate by 25bps to 6 percent on August 2nd 2017, in line with market expectations. It is the first rate cut so far this year, bringing borrowing cost to the lowest since 2010 amid a sharp slowdown in inflation. The reverse repo rate was also lowered by 25bps to 5.75 percent and the marginal standing facility rate and the Bank Rate to 6.25 percent.

Excerpts from the RBI Press Release:

The decision of the MPC is consistent with a neutral stance of monetary policy in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.

The second bi-monthly statement projected quarterly average headline inflation in the range of 2.0-3.5 per cent in the first half of the year and 3.5-4.5 per cent in the second half. The actual outcome for Q1 has tracked projections. Looking ahead, as base effects fade, the evolving momentum of inflation would be determined by (a) the impact on the CPI of the implementation of house rent allowances (HRA) under the 7th central pay commission (CPC); (b) the impact of the price revisions withheld ahead of the GST; and (c) the disentangling of the structural and transitory factors shaping food inflation. The inflation trajectory has been updated taking into account all these factors and incorporates the first round impact of the implementation of the HRA award by the Centre.

The MPC observed that while inflation has fallen to a historic low, a conclusive segregation of transitory and structural factors driving the disinflation is still elusive. In respect of inflation-sensitive vegetables, prices are recording spikes. Excess supply conditions continue to push down prices of pulses and keep those of cereals in check. The MPC will continue monitoring movements in inflation to ascertain if recent soft readings are transient or if a more durable disinflation is underway. In its assessment of real activity, the MPC noted that while the outlook for agriculture appears robust, underlying growth impulses in industry and services are weakening, given corporate deleveraging and the retrenchment of investment demand.

The MPC noted that some of the upside risks to inflation have either reduced or not materialised - (i) the baseline path of headline inflation excluding the HRA impact has fallen below the projection made in June to a little above 4 per cent by Q4; (ii) inflation excluding food and fuel has fallen significantly over the past three months; and, (iii) the roll-out of the GST has been smooth and the monsoon normal. Consequently, some space has opened up for monetary policy accommodation, given the dynamics of the output gap. Accordingly, the MPC decided to reduce the policy repo rate by 25 basis points. Noting, however, that the trajectory of inflation in the baseline projection is expected to rise from current lows, the MPC decided to keep the policy stance neutral and to watch incoming data. The MPC remains focused on its commitment to keeping headline inflation close to 4 per cent on a durable basis.

Reserve Bank of India | Joana Taborda | joana.taborda@tradingeconomics.com
8/2/2017 9:24:18 AM



Calendar GMT Actual Previous Consensus TEForecast
2017-04-06 09:00 AM RBI Interest Rate Decision 6.25% 6.25% 6.25% 6.25%
2017-06-07 09:00 AM RBI Interest Rate Decision 6.25% 6.25% 6.25% 6.25%
2017-08-02 09:00 AM RBI Interest Rate Decision 6% 6.25% 6% 6%
2017-10-04 09:00 AM RBI Interest Rate Decision 6% 6%
2017-12-06 09:00 AM RBI Interest Rate Decision 6%


India Money Last Previous Highest Lowest Unit
Interest Rate 6.00 6.25 14.50 4.25 percent [+]
Cash Reserve Ratio 4.00 4.00 10.50 4.00 percent [+]
Interbank Rate 6.11 6.07 12.97 3.10 percent [+]
Money Supply M1 26777.10 27100.10 28420.20 80.15 INR Billion [+]
Money Supply M2 28225.84 28286.73 29134.50 1127.49 INR Billion [+]
Money Supply M3 129912.80 129968.91 129968.91 123.52 INR Billion [+]
Central Bank Balance Sheet 17271.50 17519.08 23419.03 1624.31 INR Billions [+]
Foreign Exchange Reserves 402510.00 400730.00 402510.00 29048.00 USD Million [+]
Loan Growth 6.50 6.30 18.70 4.10 percent [+]
Reverse Repo Rate 5.75 6.00 13.50 3.25 percent [+]


India Interest Rate

In India, interest rate decisions are taken by the Reserve Bank of India's Central Board of Directors. The official interest rate is the benchmark repurchase rate. In 2014, the primary objective of the RBI monetary policy became price stability, giving less importance to government's borrowing, the stability of the rupee exchange rate and the need to protect exports. In February 2015, the government and the central bank agreed to set a consumer inflation target of 4 percent, with a band of plus or minus 2 percentage points, from the financial year ending in March 2017. This page provides - India Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. India Interest Rate - actual data, historical chart and calendar of releases - was last updated on September of 2017.

Actual Previous Highest Lowest Dates Unit Frequency
6.00 6.25 14.50 4.25 2000 - 2017 percent Daily




interest rate by Country

Last
Russia 8.50 Sep/17
Brazil 8.25 Sep/17
Turkey 8.00 Sep/17
Mexico 7.00 Aug/17
India 6.00 Aug/17
China 4.35 Aug/17
Indonesia 4.25 Sep/17
Australia 1.50 Sep/17
South Korea 1.25 Aug/17
United States 1.25 Sep/17
Canada 1.00 Sep/17
United Kingdom 0.25 Sep/17
Euro Area 0.00 Sep/17
France 0.00 Sep/17
Germany 0.00 Sep/17
Italy 0.00 Sep/17
Netherlands 0.00 Sep/17
Spain 0.00 Sep/17
Japan -0.10 Sep/17
Switzerland -0.75 Sep/17