In a move closely watched by businesses and households across India, the Reserve Bank of India (RBI) has decided to retain the repo rate at 6.5% after its latest bi-monthly policy review meeting. The central bank’s Monetary Policy Committee (MPC), headed by Governor Shaktikanta Das, voted unanimously to keep rates on hold for a seventh consecutive time, maintaining an accommodative stance as inflation remains within the target range.
Inflation forecasts were also updated, with retail inflation seen moderately higher at 4.9% in the first quarter of the current financial year but trending down thereafter. GDP growth for 2024-25 was projected at a robust 7%, signaling confidence in India’s economic fundamentals despite global headwinds. The announcement comes as welcome news for borrowers as stable interest rates help sustain demand while offering much needed stability during uncertain times.
In his post-meeting address, Governor Das emphasized that liquidity conditions would continue to remain comfortable. This dovetails with the RBI’s ongoing efforts to balance growth and inflationary pressures, ensuring adequate credit flow even as it safeguards purchasing power. Key sectors like housing were highlighted, with stable rates supporting affordability as well as the overall real estate sector through higher consumer spending.
By keeping rates steady despite mounting cost-push pressures, the central bank has reiterated its focus on a gradual, calibrated policy normalization. The move signals consistency for markets while prioritizing medium-term goals over transient factors. In line with itsflexible approach, the MPC is expected to closely monitor incoming data and global spillovers to calibrate its actions appropriately.
