- The RBI MPC kept the repo rate unchanged at 5.25%.
- The Monetary Policy Committee retained its neutral policy stance.
- RBI projected 6.7% GDP growth and 5.0% CPI inflation for 2026-27.
Mumbai: The Reserve Bank of India (RBI) on Wednesday kept the repo rate unchanged at 5.25%, with the Monetary Policy Committee (MPC) unanimously deciding to maintain its neutral policy stance. Announcing the policy decision, RBI Governor Sanjay Malhotra said the Indian economy remains resilient despite global uncertainties, supported by strong domestic demand, robust exports and steady expansion in manufacturing and services.
The policy decision leaves key lending rates unchanged while allowing the central bank to closely monitor inflation and growth trends.
RBI MPC Repo Rate Decision and Key Policy Rates
Following the MPC decision:
- Repo Rate: 5.25%
- Standing Deposit Facility (SDF) Rate: 5.00%
- Marginal Standing Facility (MSF) Rate: 5.50%
- Bank Rate: 5.50%
The RBI said retaining the neutral stance provides flexibility to respond to evolving domestic and global economic conditions while supporting macroeconomic stability.
GDP Growth and Inflation Outlook
The central bank projected real GDP growth at 6.7% for 2026-27, with quarterly estimates as follows:
- Q1: 7.0%
- Q2: 6.4%
- Q3: 6.5%
- Q4: 6.8%
For the first quarter of 2027-28, GDP growth is projected at 7.3%.
On inflation, Governor Malhotra said Consumer Price Index (CPI) inflation rose to 4.4% in June 2026 after remaining below the RBI’s target for 16 consecutive months. However, the figure was lower than the central bank’s earlier projection for the quarter.
The RBI forecasts:
- CPI Inflation for 2026-27: 5.0%
- Q2: 4.7%
- Q3: 5.9%
- Q4: 5.5%
- Q1 of 2027-28: 5.3%
RBI Says Growth Remains Strong Despite Global Headwinds
Governor Malhotra said India’s economy continues to benefit from resilient domestic demand, sustained manufacturing and services activity and healthy export performance, reinforcing its position among the world’s fastest-growing major economies.
He added that the expected rise in headline inflation is largely driven by food and fuel supply-side factors rather than broad-based demand pressures. The RBI also projected core inflation at 4.3% for 2026-27, noting that underlying inflationary pressures remain moderate and are expected to ease after peaking in the third quarter.
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