Photo: MintMumbai: Four out of six members of the monetary policy committee (MPC) were in favour of changing the monetary policy stance to neutral from accommodative on 7 February, according to minutes of the meeting released on Wednesday. The main argument for a change in stance was stubborn inflation, mainly core inflation. This, coupled with the impact of remonetization of the economy could result in hardening of the headline inflation number, according to the MPC minutes. While announcing the monetary policy, governor Patel said all six members had agreed to hold the repo rate at 6.25%. “...the normalization of administered small savings rates that have prevented a seamless transmission of monetary policy to bank funding and lending rates,” the deputy governor said.

Source: Mint February 22, 2017 13:09 UTC