The Reserve Bank of India’s Monetary Policy Committee unanimously held the policy repo rate at 5.25% and retained its neutral stance, citing supply-led inflation pressures, resilient but slower projected growth and uncertainty around the inflation path. Over the past year, the repo rate was held at 5.50% through October 2025, cut 25 basis points in December and held at 5.25% since. The Reserve Bank of India will conduct two-way liquidity operations to align the weighted average call rate with the repo rate. Consumer price index inflation rose to 4.4% in June and is projected at 5.0% in 2026-27, with food and fuel expected to push headline inflation to a third-quarter peak before moderation, while real gross domestic product growth is forecast at 6.7% and credit growth remains robust. Foreign exchange reserves provide more than 10 months of import cover. The global outlook is clouded by the West Asia conflict, volatile energy prices, disrupted trade routes and supply chains, and fresh US tariffs. The committee said greater clarity on inflation’s path and composition was needed before policy action and pledged to remain vigilant in aligning inflation with the target.
Reserve Bank of India2026-08-05
Reserve Bank of India Holds Policy Repo Rate at 5.25% With Neutral Stance
The Reserve Bank of India’s Monetary Policy Committee unanimously held the policy repo rate at 5.25% and retained its neutral stance, citing supply-led inflation pressures, resilient but slower projected growth, and inflation uncertainty. Consumer price index inflation is projected at 5.0% and real gross domestic product growth at 6.7% in 2026-27, while the Reserve Bank of India will conduct two-way liquidity operations to align the weighted average call rate with the repo rate.