The Reserve Bank of India’s Monetary Policy Committee, led by RBI Governor Sanjay Malhotra, retained the benchmark repo rate at 5.5%, after front-loading the three rate cuts in February, April and June this year. However, the RBI revised the CPI inflation forecast downward while revising the GDP growth forecast upward.
Space for monetary action has opened up, Malhotra said, adding that the MPC considers it prudent to wait before beginning to cut rates further.
Amidst benign inflation, prevailing global uncertainties and tariff-related developments are likely to decelerate growth in H2:2025-26 and beyond, stated the resolution of the MPC. “The current macroeconomic conditions and the outlook have opened up policy space for further supporting growth,” it stated.
After the review, the Monetary Policy Committee decided the following:
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To maintain the policy repo rate at 5.5% unanimously.
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The standing deposit facility rate, pegged 25 basis points below the repo rate, remains unchanged at 5.25%.
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The marginal standing facility rate, which is 25 basis points above the repo rate, remains unchanged at 5.75%.
The committee also retained its stance at ‘neutral’.
