RBI keeps key interest rates on hold as Covid-19 cases rise

The Reserve Bank of India (RBI) on Wednesday kept interest rates on hold and maintained an accommodative policy stance to nurture a fragile economic recovery after the three-day meeting of its monetary policy committee (MPC).

This came amid a sharp new wave of Covid-19 cases in several states and local lockdowns, reigniting uncertainty regarding economic outlook in the immediate term.

The repo rate and reverse repo rate thus remain unchanged at 4 per cent and 3.35 per cent respectively.

Repo is the rate at which RBI lends funds to commercial banks when needed. It is a tool that the central bank uses to control inflation. The reverse repo rate is the rate at which the RBI borrows from banks.

( With inputs from ANI )