Our Bureau
Mumbai
The Reserve Bank of India (RBI) on Wednesday kept the benchmark repo rate unchanged at 5.25 per cent, with the Monetary Policy Committee (MPC) unanimously voting to maintain the status quo while retaining its neutral monetary policy stance. The decision reflects the central bank’s cautious approach as it balances inflation risks against sustaining economic growth amid persistent global uncertainties.
Announcing the policy decision, RBI Governor Sanjay Malhotra said domestic economic activity continues to remain resilient despite heightened geopolitical tensions and volatile global commodity prices. The central bank revised its FY2026-27 GDP growth forecast upward to 6.7 per cent, while projecting average inflation at around 5 per cent for the fiscal year, signalling confidence in India’s macroeconomic fundamentals.
The MPC also left other key policy rates unchanged, with the Standing Deposit Facility (SDF) rate remaining at 5 per cent, while the Marginal Standing Facility (MSF) rate and the bank rate continue at 5.5 per cent. The RBI indicated that the neutral stance provides flexibility to respond to evolving inflationary and growth dynamics without committing to either easing or tightening policy.
The decision was widely anticipated by economists, who cited elevated crude oil prices, geopolitical developments, and inflation uncertainties as reasons for the central bank to avoid any immediate change in borrowing costs. Analysts believe the policy continuity will provide stability to financial markets while ensuring that lending rates and equated monthly instalments (EMIs) for existing borrowers remain largely unchanged in the near term.
Going forward, the RBI said it would continue to closely monitor inflation trends, monsoon developments, global economic conditions and financial market volatility before taking any future policy action, reiterating its commitment to maintaining price stability while supporting sustainable economic growth.