The RBI's Monetary Policy Committee kept the repo rate unchanged at 5.25% in a unanimous decision.
The central bank also retained its neutral monetary policy stance.
The policy highlighted global uncertainty, including the West Asia conflict, as a key risk to the economic outlook.
RBI MPC Keeps Repo Rate Steady at 5.25%, Maintains Neutral Stance
The Monetary Policy Committee unanimously voted to maintain the repo rate at 5.25%, while the RBI flagged risks from global uncertainty, crude oil volatility and disruptions to trade routes
Summary
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The Reserve Bank of India (RBI) on Wednesday kept the policy repo rate unchanged at 5.25%, in line with market expectations, while retaining its "neutral" monetary policy stance.
The six-member Monetary Policy Committee (MPC), which met between August 3 and 5, unanimously voted to maintain the benchmark lending rate. With the repo rate unchanged, the Standing Deposit Facility (SDF) rate remains at 5%, while the Marginal Standing Facility (MSF) rate and the Bank Rate continue at 5.5%.
Announcing the decision, RBI Governor Sanjay Malhotra said the MPC took the decision after assessing domestic macroeconomic conditions and developments in the global economy. The central bank highlighted rising uncertainty due to the continuing conflict in West Asia and its impact on trade, supply chains and financial markets.
Global Risks Remain in Focus
Governor Malhotra said the ongoing conflict in West Asia has disrupted trade routes and supply chains, increased market volatility and weakened business sentiment.
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He added that global growth is expected to slow, while inflation is likely to remain elevated in 2026. According to the RBI, uncertainty has increased as some central banks have tightened monetary policy while others have adopted a more cautious approach.
The RBI also noted that crude oil prices, currency movements and financial markets continue to fluctuate with geopolitical developments, making the external environment uncertain.