New Delhi: The newly-inducted Monetary Policy Committee (MPC) directed by RBI Governor Urjit Patel is unlikely to low rates at its maiden policy review on Tuesday as it awaits more supporting data on inflation.
The monetary policy review on Oct 4 will be the first by the six-member MPC as well as Governor Patel, who as the deputy governor had depict the RBI as an owl when it comes to inflation managing.
August retail inflation eased to a five-month low of 5.05 % but WPI inflation ascend to a two-year high of 3.74 %. Before the dip in August, both the retail also wholesale price indices were on a continuous rising spiral. The government had in August notified 4 percent inflation target with a range of plus/minus 2 % for the next five years under the monetary policy framework deal with the Reserve Bank.
MPC has three members each from the government & the Reserve Bank. The nominees of govt are the Indian Statistical Institute professor, Chetan Ghate, Pami Dua the Director at Delhi School of Economics & Professor at IIM-Ahmedabad, Ravindra H Dholakia, while RBI nominees are the Governor, Deputy Governor in-charge of monetary policy R Gandhi & Executive Director Michael Patra. For the upcoming monetary policy declaration, the RBI has rescheduled the timing to mid-afternoon against the usual 1100 hrs.
If the six-member panel is divided on rate decision, the Governor can use his rejection power to take a final call on the policy rates.