RBI to announce monetary policy decision on Wednesday

Mumbai: The Reserve Bank will come out with monetary policy review, the first after demonetisation of old Rs 500/1000 notes, on Wednesday amid expectations of interest rate cut.

"The Monetary Policy Committee (MPC) will meet on December 6 and 7, 2016 for the Fifth Bi-monthly Monetary Policy Statement for 2016-17.

"The resolution of the MPC will be placed on the website at 2.30 pm on December 7, 2016," the central bank said.

Interestingly, the monetary policy reviews were usually announced on Tuesdays. For long, the central bank has been unveiling the monetary policy at 11 am.

It will be for the second time that the monetary policy would be based on the recommendation of the MPC.

There are expectations of rate cut (repo) as banks are flushed with funds following demonetisation of old high value notes from November 9.

RBI has already taken a host of steps, including 100 per cent incremental increase in CRR, to suck out excess liquidity from banks.

At a time when the country is undergoing a demonetisation drive, the Reserve Bank of India (RBI), in its next policy meeting on December 7, may increase the main interest rate by 50 basis points, feels Keki Mistry, Vice Chairman and CEO of HDFC.

With Agency Inputs