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2w ago

RBI Pauses Easing, Holds Repo Rate at 5.5%

The central bank left its repo rate at 5.5% with a neutral stance to evaluate the full effect of its earlier easing in the face of evolving global trade risks.

RBI Governor Sanjay Malhotra in Mumbai.
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Overview

  • The Monetary Policy Committee voted unanimously to maintain the repo rate at 5.5% after front-loading 100 basis points of cuts since February.
  • The RBI retained a neutral policy stance to allow previous rate reductions to transmit fully into lending and economic activity.
  • FY26 growth was kept at 6.5% while the CPI inflation forecast was revised down to 3.1% from 3.7%.
  • Governor Sanjay Malhotra highlighted evolving US tariff threats and broader trade uncertainty as key considerations in the decision.
  • Headline CPI inflation fell to 2.1% in June, its lowest since early 2019, supported by food price declines following a strong monsoon.