The Reserve Bank of India kept the repo rate unchanged at 5.25% and retained a neutral stance, citing a favourable macroeconomic environment. With inflation projected at 2.1% for FY26 and GDP growth expected at 7.4%, the central bank opted for a cautious pause to allow the impact of earlier rate cuts to transmit fully. The decision ensures stability in borrowing costs and EMIs while preserving policy flexibility to respond to risks such as global uncertainty, crude oil volatility, and potential inflationary pressures.
Click to View MoreThe RBI’s 25 bps repo rate cut to 5.25% reflects confidence in low inflation and strong growth, aiming to boost borrowing, investment and consumption through cheaper credit. While it supports economic momentum, risks persist due to rupee weakness and uncertain external conditions, making cautious monetary calibration essential.
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