New Delhi:
Monetary Policy Committee – MPC of RBI is going to give its verdict on interest rates on 7 February today i.e. on 7 February. Experts and analysts are already expecting a rate cut in repo rate. But this time the RBI MPC meeting is going to be special in many cases. Let’s know those 3 big reasons, due to which this meeting is made in the headlines. Along with this, we will also know that the common man will get relief from the decision of RBI regarding interest rates …
1. New Governor Sanjay Malhotra’s first policy
This is the first monetary policy meeting, which will be chaired by the recently appointed RBI Governor Sanjay Malhotra. He took over as the 26th Governor of the Reserve Bank of India on 9 December 2024. He has been replaced by Shaktikanta Das and is the 15th civil servant to handle the post.
Sanjay Malhotra has previously been India’s Revenue Secretary of India and is known as a business-friendly bureaucrat. In view of their previous reforms, BFSI (Banking, Financial Services, and Insurance) sector has high expectations from them. Therefore, everyone’s eyes will remain on the announcement made by them.
2. Will interest rates be deducted after 5 years?
This time almost every expert is expecting the repo rate cut. If RBI cuts interest rates, this will be the first time in 5 years when policy rates will change.
- During the Kovid-19 (Covid-19) in 2020, RBI last changed interest rates.
- This time the cut of 25 basis points (BPS) is expected to be cut.
- Bond price rally is also going up rapidly with this possible cut.
If interest rates are cut, it will directly affect the bank loan, home loan, business loan and the entire economy.
3. Rajeshwar Rao becomes in charge of monetary policy committee
RBI Kedipty Governor Rajeshwar Rao has been given the responsibility of leading the Monetary Policy Committee – Mpc, until the replacement of Michael Patra is announced.
The term as Michael Patra Capital Governor ended on 15 January 2025. Rajeshwar Rao will play this role until the new deputy governor is appointed. The market will also keep an eye on Rajeshwar Rao’s policies, because their policies will later decide the economic direction of the country.
What will be the effect of this RBI MPC meeting?
- If interest rates decrease (Rate Cut), then home loan, car loan and business loans can be cheap.
- Stock market can see a boom.
- Bond yields may decline.
- Economic growth can gain momentum.
In such a situation, RBI MPC meeting this time is going to be special in many cases. New Governor’s first policy, potential interest rate deduction and entry of new policy makers. Now it will have to be seen what kind of announcement RBI makes and what effect it has on the market and the common man.