<p>The <a href="https://www.deccanherald.com/search?q=rbi">Reserve Bank of India's </a>(RBI) Monetary Policy Committee (MCP) on Wednesday announced that it had decided to keep the policy repo rate unchanged at 5.25 per cent and maintain a neutral stance.</p><p>In his statement, RBI Governor Sanjay Malhotra said, "After a detailed assessment of the evolving macroeconomic and financial developments and the outlook, the MPC voted unanimously to keep the policy repo rate unchanged under the liquidity facility at 5.25%. Consequently, the STF rate remains at 5% and the MSF rate and the bank rate at 5.5%. The MPC also decided to continue with the neutral strands."</p><p>The policy decision comes as a month-and-a-half-long West Asia conflict has disrupted energy supplies, shot up crude oil prices and created fiscal and inflationary pressures for import-dependent nations like India.</p>.RBI announces more actions amid rupee depreciation.<p>The RBI has reduced interest rates by a total of 125 basis points since February 2025. The last cut came in December last year. </p><p>Malhotra said that the global economy faces unprecedented challengers from geopolitical tensions, including disruption in global supply chains. </p><p>He added that despite the West Asia conflict, for which a ceasefire was announced today, India's macroeconomic fundamentals exuded confidence with buoyant growth and low inflation.</p><p>"Conditions, however, turned adverse in March with the widening of the conflict zone and its intensification. The fundamentals of the Indian economy are on a stronger footing at the current juncture than it was in previous crisis episodes, as well as relative to many other economies, providing it with greater resilience to withstand shocks," Malhotra added. </p><p>The RBI Governor said that the real GDP growth for the last year (FY2025-26) was estimated at 7.6%, showcasing strong momentum in economic activity supported by robust consumption and investment. </p><p>However, he said that energy disruption and rising energy cost due to the disruptions in the Strait of Hormuz could impact economic growth this year. </p><p>The RBI projected GDP growth for FY2026-27 at 6.9 per cent, compared to 7.6 per cent last year.</p><p>"The government has been proactive in ensuring the supply of inputs across critical sectors to minimise the impact of supply chain disruptions," Malhotra said. </p><p>"On the other hand, sustained momentum in the services sector, the persisting impact of GST rationalisation which was carried out last year and the healthy balance sheets of financial institutions and corporates should continue to support economic activity," he added. </p><p>Further, the RBI projected CPI inflation at 4.6% for current fiscal. This is the first monetary policy review after the government announced a fresh inflation target for the RBI last month. </p><p>The government has asked the RBI to maintain retail inflation at 4% with a margin of 2% on either side for another five years ending March 2031.</p>
<p>The <a href="https://www.deccanherald.com/search?q=rbi">Reserve Bank of India's </a>(RBI) Monetary Policy Committee (MCP) on Wednesday announced that it had decided to keep the policy repo rate unchanged at 5.25 per cent and maintain a neutral stance.</p><p>In his statement, RBI Governor Sanjay Malhotra said, "After a detailed assessment of the evolving macroeconomic and financial developments and the outlook, the MPC voted unanimously to keep the policy repo rate unchanged under the liquidity facility at 5.25%. Consequently, the STF rate remains at 5% and the MSF rate and the bank rate at 5.5%. The MPC also decided to continue with the neutral strands."</p><p>The policy decision comes as a month-and-a-half-long West Asia conflict has disrupted energy supplies, shot up crude oil prices and created fiscal and inflationary pressures for import-dependent nations like India.</p>.RBI announces more actions amid rupee depreciation.<p>The RBI has reduced interest rates by a total of 125 basis points since February 2025. The last cut came in December last year. </p><p>Malhotra said that the global economy faces unprecedented challengers from geopolitical tensions, including disruption in global supply chains. </p><p>He added that despite the West Asia conflict, for which a ceasefire was announced today, India's macroeconomic fundamentals exuded confidence with buoyant growth and low inflation.</p><p>"Conditions, however, turned adverse in March with the widening of the conflict zone and its intensification. The fundamentals of the Indian economy are on a stronger footing at the current juncture than it was in previous crisis episodes, as well as relative to many other economies, providing it with greater resilience to withstand shocks," Malhotra added. </p><p>The RBI Governor said that the real GDP growth for the last year (FY2025-26) was estimated at 7.6%, showcasing strong momentum in economic activity supported by robust consumption and investment. </p><p>However, he said that energy disruption and rising energy cost due to the disruptions in the Strait of Hormuz could impact economic growth this year. </p><p>The RBI projected GDP growth for FY2026-27 at 6.9 per cent, compared to 7.6 per cent last year.</p><p>"The government has been proactive in ensuring the supply of inputs across critical sectors to minimise the impact of supply chain disruptions," Malhotra said. </p><p>"On the other hand, sustained momentum in the services sector, the persisting impact of GST rationalisation which was carried out last year and the healthy balance sheets of financial institutions and corporates should continue to support economic activity," he added. </p><p>Further, the RBI projected CPI inflation at 4.6% for current fiscal. This is the first monetary policy review after the government announced a fresh inflation target for the RBI last month. </p><p>The government has asked the RBI to maintain retail inflation at 4% with a margin of 2% on either side for another five years ending March 2031.</p>
