Now Reading: RBI holds rates at 5.25%, lifts FY27 growth forecast to 6.7%
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RBI holds rates at 5.25%, lifts FY27 growth forecast to 6.7%
The Reserve Bank of India kept the repo rate unchanged at 5.25% for the fourth consecutive meeting, with the Monetary Policy Committee voting unanimously to retain a 'neutral' stance. Governor Sanjay Malhotra…
The Story in Brief
The Reserve Bank of India kept the repo rate unchanged at 5.25% for the fourth consecutive meeting, with the Monetary Policy Committee voting unanimously to retain a 'neutral' stance. Governor Sanjay Malhotra raised the FY27 GDP growth forecast to 6.7% from 6.6% and lowered the inflation projection to 5% from 5.1%, citing resilient domestic demand but warning of risks from West Asia tensions, El Nino, and trade policy. A JM Financial report expects the RBI to remain on hold through 2026, relying on liquidity management instead of rate changes. The BSE Sensex gained 152 points in volatile trading, while the rupee recovered to around ₹95.
The Indian Opinion
The narrative that a low-rate regime is powering India's growth ignores the reality that private investment remains selective and concentrated in PLI-linked sectors. Meanwhile, talk of a prolonged pause hurting expansion overlooks the fact that credit growth is robust and core inflation is benign. The real test will be whether the 6.7% GDP forecast materialises if consumption fails to broaden beyond urban pockets.
Sources (5): bfsi.economictimes.indiatimes.com, bfsi.economictimes.indiatimes.com (2), thehindu.com, rediff.com, rediff.com (2)
This story was synthesised by AI from the 5 sources linked above.
Updated: this story now draws on 5 sources.
