RBI retains the repo rate at 5.25 per cent while highlighting resilience of the Indian economy amid global challenges
The Reserve Bank of India (RBI) on Friday kept the benchmark repo rate unchanged at 5.25 per cent, maintaining a cautious approach as global economic uncertainties continue to weigh on growth and financial markets.
Announcing the outcome of the second bi-monthly Monetary Policy Committee (MPC) meeting for FY27, RBI Governor Sanjay Malhotra said the committee unanimously decided to retain the policy rate at 5.25 per cent.
The repo rate is the rate at which the RBI lends short-term funds to commercial banks and serves as a key benchmark for interest rates across the economy.
Speaking after the policy review, Governor Malhotra noted that the global economy remains clouded by unprecedented challenges and heightened uncertainty. Despite these concerns, he expressed confidence in India’s ability to navigate external shocks with minimal disruption.
The RBI’s decision means borrowing costs are likely to remain unchanged for now. Any increase in the repo rate generally makes loans such as home, vehicle and business loans more expensive, while a reduction helps lower borrowing costs and encourages spending and investment.
Market participants closely monitor the RBI’s policy decisions as they have a direct impact on lending rates, economic growth, inflation management and overall financial conditions.
The latest policy stance reflects the central bank’s effort to balance growth concerns with inflation risks while maintaining stability in an uncertain global environment.
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