Mumbai | The Reserve Bank of India on Friday decided to keep the policy rate unchanged for the eighth time in a row, saying it will maintain a tight vigil on inflation.

The rate increase cycle was paused in April last year after six consecutive rate hikes, aggregating to 250 basis points since May 2022.

Announcing the second bi-monthly monetary policy for the current financial year, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged at 6.5 per cent.

He said MPC will remain watchful of elevated food inflation amid the expectation of a normal monsoon.

The RBI raised the growth projection to 7.2 per cent from an earlier estimate of 7 per cent for the current financial year.

The government has mandated the RBI to ensure CPI inflation at 4 per cent with a margin of 2 per cent on either side.