RBI MPC keeps policy rate unchanged at 5.25%

The Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) maintained the repo rate at 5.25% amid global uncertainties. The RBI announced its monetary policy decision on Wednesday (August 5, 2026).

MPC unanimously decided in favour of the status quo on the policy interest rate with a neutral stance, said RBI Governor Sanjay Malhotra.

“West Asia conflict continues to challenge global economy by disrupting key trade routes,” the central bank governor added.

The real GDP for FY27 is projected at 6.7%, 10 basis points (bps) higher than the previous forecast. “Inflation will peak in Q3, led by food and fuel price inflation,” he said.

Overall economic outlook hazy due to deficient monsoon. Supply-side process eased in June, but volatility had been amplified since July due to escalation of the West Asia conflict. However, the Indian economy has performed better than expected in the April-June quarter of this fiscal, Mr. Malhotra noted.