The Reserve Bank of India's decision to keep the repo rate unchanged was no surprise given the focus with which the Monetary Policy Committee has approached its mandate: of keeping inflation in check. With the relevant measure of price gams, the Consumer Price Index, reflecting acceleration in inflation for a sixth straight month in December, and that at the fastest pace in 17 months, the bank's rate-setting panel must have had little difficulty in choosing to remain on hold. This was probably best exemplified by the reversal in stance of the six-member panel's hitherto most dovish member, Ravindra H. Dholakia, to vote to stand pat on interest rates. This the MPC did while retaining a 'neutral stance', which gives it the flexibility to change gears in either direction.
Why didn't the RBI change the repo rate?

Options

A. To keep deflation in check.
B. To keep inflation in check.
C. To adhere to the Monetary Policy Committee's report
D. To keep a balance between poverty and income.

Answer

B