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RBI holds repo rate steady at 5.25 percent
Times of India··5 Aug
The Reserve Bank of India kept the repo rate unchanged at 5.25% as the Monetary Policy Committee retained a neutral stance unanimously under Governor Sanjay Malhotra. It raised the FY27 GDP growth forecast to 6.7% and lowered the CPI inflation projection to 5%, citing global uncertainty as a reason to wait before any rate cut.
Prism
What It Means For You
- Home and vehicle loan borrowers can expect EMI rates linked to the repo to stay broadly steady for now.
- Savers watching fixed deposits should note that a hold at 5.25 percent keeps the near-term rate path cautious.
- Anyone budgeting for FY27 can weigh the RBI's higher growth forecast against its still-watchful inflation outlook.
What's Happening
- The Reserve Bank of India kept the repo rate unchanged at 5.25 percent, with the MPC retaining a neutral stance unanimously.
- Governor Sanjay Malhotra's committee raised the FY27 GDP growth forecast to 6.7 percent and lowered the CPI inflation projection to 5 percent.
- Officials cited global uncertainty, including geopolitical risks, as a reason to hold rather than cut immediately.
What An Unchanged Repo Rate Means For Borrowers
- A neutral stance leaves room for future cuts or holds depending on incoming inflation and growth data.
- Lower projected CPI at 5 percent suggests policymakers see price pressures easing even while keeping policy steady.
- Global shocks can still feed into fuel, food, and financial markets, so domestic rate decisions remain tied to external risk.
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