New Delhi: The Reserve Bank of India (RBI) on Wednesday announced that it will maintain its key lending rate, known as the repo rate, at 5.5%. The six-member Monetary Policy Committee (MPC), led by RBI Governor Sanjay Malhotra, made this decision unanimously following their meeting held from August 4 to 6.
The RBI retained its “neutral” policy stance, signaling a cautious approach amid persistent global trade uncertainties, including US tariff hikes and geopolitical tensions. The committee noted that while headline inflation has eased and currently stands well below earlier projections, core inflation remains at around 4%, with an expectation of an uptick in the last quarter of the financial year.
The central bank kept its GDP growth forecast steady at 6.5% for the fiscal year 2025-26, expressing confidence in India’s steady economic expansion, fortified by favorable monsoon patterns and the approaching festive season, which typically boosts market activity.
Inflation projections were revised downward, with the Consumer Price Index (CPI) inflation expected to average 3.1% in FY26, a decline from the previous estimate of 3.7% made in June. The MPC acknowledged the limited room for further policy easing, pointing out the cumulative 100 basis points rate cut already implemented earlier this year.
‘No major impact of US tariff on Indian economy’
Governor Malhotra emphasized a “wait-and-watch” approach, allowing the RBI to monitor the impact of previous monetary measures before making future adjustments. Any rate changes are likely to be considered post-October, depending on economic data and evolving global conditions.
“We don’t see a major impact of US tariff (on economy) unless you have retaliatory tariff,” said the RBI governor.
In addition to the monetary policy decisions, the RBI announced plans to standardize claim settlements related to bank locker contents, reinforcing its focus on improving customer protection and operational clarity.
This policy decision highlights the RBI’s balanced effort to foster economic growth while maintaining inflation stability amid an uncertain external environment.
All data and statements are based on the official RBI announcements and verified sources as of August 6, 2025.