RBI Maintains Status Quo on Repo Rate, Upgrades Economic Growth Outlook
The Reserve Bank of India (RBI) has announced its latest monetary policy decision, keeping the key repo rate unchanged at 5.25%. This move, made by the Monetary Policy Committee (MPC), reflects a continued focus on balancing inflation concerns with economic growth.
Governor Sanjay Malhotra Affirms Neutral Stance
RBI Governor Sanjay Malhotra stated that the committee has decided to maintain a neutral monetary policy stance. This approach allows the central bank flexibility to adjust rates in the future based on evolving economic conditions, without committing to a predetermined direction.
Revised GDP Forecast Signals Stronger Growth Trajectory
In a significant update, the RBI has revised its GDP growth forecast for the financial year 2026-27 (FY27) to 7.4%. This upward revision indicates growing confidence in India's economic resilience and recovery momentum, surpassing previous estimates.
Key Implications for Banks and Consumers
The decision to hold rates steady has direct consequences for both financial institutions and the public:
- For Banks: Lending and borrowing rates are likely to remain stable in the near term, providing predictability for credit operations.
- For Customers: Existing loan EMIs and deposit interest rates are expected to stay unchanged, offering relief to borrowers and savers alike.
The announcement, made on 06 February 2026, underscores the RBI's cautious optimism amid global uncertainties. By keeping the repo rate at 5.25% and boosting the GDP outlook, the central bank aims to support sustainable economic expansion while monitoring inflationary pressures closely.
