RBI · Monetary Policy
RBI keeps repo rate unchanged at 5.25%, retains neutral stance
MPC votes unanimously to hold rate amid elevated inflation and growth risks; raises inflation forecast to 5.1% for FY27, cuts GDP projection to 6.6%
What changed
- Repo rate held at 5.25%
- Neutral stance retained
- CPI inflation forecast raised to 5.1% for FY27
The read
The decision buys time. The MPC held the repo rate at 5.25% and retained a neutral stance, choosing caution as inflation rises and growth slows. Inflation is projected at 5.1% for 2026-27, breaching the 4% target and nearing the 6% upper tolerance in Q3. Growth forecast was trimmed to 6.6% due to elevated energy prices, supply disruptions, and a sub-normal monsoon. The RBI's wait-for-clarity approach is logical, but rising inflation leaves little room for easing. Verdict: a hold that buys time but does not resolve the trade-off.
Key numbers
- Repo rate: 5.25%
- CPI inflation forecast 2026-27: 5.1%
- GDP growth forecast 2026-27: 6.6%
Primary source: rbi.org.in