With gradual success in improved vaccination numbers and policy normalization reserve Bank of IndiaThe Monetary Policy Committee may choose to maintain status quo on policy rates at its meeting this week.

Instead, the Reserve Bank may choose to raise the reverse repo rate in between policy meetings. A research report by economists

says that since the essential mandate of MPC One is to set policy rates to achieve inflation Not aiming for liquidity management, RBI need not revise reverse repo rates only during MPC meetings. ,

Nowhere in the mandate of the MPC is there any reference to its role in liquidity management, which remains internal to the functioning of the bank in line with its policy stance,” said the group’s chief economic advisor SK Ghosh in the report.

“Thus, RBI is not bound to act on reverse repo rate only in MPC” Currently repo rate at 4 per cent and reverse repo at 3.35 per cent is unchanged from May 2020. The Reserve Bank is using other liquidity management tools. Ensure adequate lendable resources to revive the economy global pandemic induced lockdown.