The Reserve Bank of India’s Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged at 6.5% but has shifted its stance to neutral from the previous accommodative position. 

This change in stance comes in the wake of the US Federal Reserve’s significant 50 basis points rate cut.

In addition to the repo rate, the standing deposit facility (SDF) rate will remain unchanged at 6.25%. The marginal standing facility (MSF) rate and the Bank Rate will remain at 6.75%.

RBI Governor Das said “Inflation horse has been brought to the stable within the tolerance band. Have to be careful about opening the gate.” 

The RBI MPC has maintained the gross domestic product (GDP) growth forecast at 7.2% for the current fiscal year. The quarterly breakdown is as follows: second quarter (Q2) at 7.0%, third quarter (Q3) at 7.4%, and fourth quarter (Q4) at 7.4%. The real GDP growth for the first quarter (Q1) of 2025-26 is projected at 7.3%.

Furthermore, the inflation projection has been held steady at 4.5%. The quarterly inflation projections are as follows: 4.1% for Q2, 4.8% for Q3, 4.2% for Q4, and 4.3% for Q1 of the next fiscal year.

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