Mumbai. The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) has taken a major decision amid global uncertainties, deciding to keep the repo rate unchanged at 5.25%. The central bank also maintained its neutral stance, leaving room for future interest rate adjustments based on economic conditions.
What is the big decision?
Repo rate remains at 5.25%
RBI’s stance is neutral
GDP growth forecast raised from 6.6% to 6.7%
Inflation forecast reduced from 5.1% to 5.0%
What did Governor Sanjay Malhotra say?
RBI Governor Sanjay Malhotra said that after assessing the current economic conditions, the six-member Monetary Policy Committee (MPC) has unanimously decided to keep the repo rate at 5.25%.
What will be the impact on common people?
With no change in the repo rate, home loan EMIs are unlikely to change for the time being. Auto loan installments will also remain the same. Interest rates on business and commercial loans are also not expected to change immediately.
RBI’s concern over global challenges
The RBI stated that the ongoing conflict in West Asia is impacting global trade routes, which could impact the world economy. In such an environment, it is important to maintain a cautious monetary policy. Between February and December 2025, the RBI has cut the repo rate by a total of 1.25%. Subsequently, the repo rate was kept stable in the February, April, June, and now August reviews. This decision by the RBI has provided relief to borrowers, while the increased GDP estimates and decreased inflation estimates are being considered positive signs for the Indian economy.