The Reserve Bank of India left its key policy rates unchanged on Friday, and upgraded its inflation outlook citing higher oil prices and monsoon uncertainty.
The Monetary Policy Committee, governed by Sanjay Malhotra, unanimously decided to hold the policy repo rate at 5.25 percent. The committee also decided to continue with the neutral stance.
The RBI had reduced the repo rate by a cumulative 125 basis points in the latest easing cycle that began in February 2025.
The standing deposit facility rate was retained at 5.00 percent and the marginal standing facility rate and the Bank Rate were maintained at 5.50 percent.
Despite the global shock, CPI inflation remained below the target, the bank observed. Although the baseline projections point towards headline inflation firming up towards the upper tolerance band in the current fiscal, the impact of the supply shock is expected to wane from March quarter, the MPC said.
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