These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2%, while supporting growth.

Real GDP growth for 2023-24 is projected at 6.5% with Q1 at 8%; Q2 at 6.5%; Q3 at 6%; and Q4 at 5.7%, with risks broadly balanced. Real GDP growth for Q1:2024-25 is projected at 6.6%.

CPI inflation is projected at 5.4% for 2023-24, with Q2 at 6.2%, Q3 at 5.7% and Q4 at 5.2%, with risks evenly balanced. CPI inflation for Q1:2024-25 is projected at 5.2%.

RBI said that the headline inflation is likely to witness a spike in the near months on account of supply disruptions due to adverse weather conditions.

The minutes of the MPC's meeting will be published on 24 August 2023. The next meeting of the MPC is scheduled during 4-6 October 2023.

Following the RBI announcement, the Nifty Bank index was down 0.56% to 44,630.20 while the benchmark Nifty 50 index was down 0.36% to 19,561.25.

AU Small Finance Bank (down 1.61%), Kotak Mahindra Bank (down 1.06%), Bank of Baroda (down 0.7%), ICICI Bank (down 0.64%), Axis Bank (down 0.52%), IDFC First Bank (down 0.51%), HDFC Bank (down 0.44%), PNB (down 0.32%), Federal Bank (down 0.15%) and SBI (down 0.1%) declined.

In the bond market, the yield on India's 10-year benchmark federal paper fell to 7.1649% compared with 7.17% at close in the previous trading session.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee rose to 82.815, compared with its close of 82.855 during the previous trading session.