What changed and what didn't? Here are key highlights from RBI’s August 2025 Monetary Policy meet
Amid intensifying geopolitical risks and global trade uncertainty, the RBI on Tuesday announced that it will maintain the repo rate steady at 5.5% retaining its neutral monetary policy stance. These are the key highlights of the RBI’s August 2025 Monetary Policy meeting.
1. Unchanged repo rate
Governor Sanjay Malhotra announced on Tuesday that the Monetary Policy Committee (MPC) unanimously decided to keep the repo rate unchanged at 5.5% and maintain the neutral stance amid global trade uncertainty.
2. Reduced CPI inflation
Amid geopolitical uncertainties, the Reserve Bank of India (RBI) sharply reduced its CPI inflation forecast for FY26 to 3.1%, down from 3.7%, and projected it at 4.9% for Q1FY27.
3. Growth Trajectory
Despite continuous uncertainty over US President Trump’s tariff threat, the RBI forecasted FY26 GDP growth at 6.5%, with quarterly projections indicating steady momentum: Q1 – 6.5%, Q2 – 6.7%, Q3 – 6.6%, Q4 – 6.3%, and Q1 FY27 – 6.6%.
4. SDF and MSF
The Standing Deposit Facility (SDF) rate remains unchanged at 5.25%. In addition, the Marginal Standing Facility (MSF) and Bank Rate remain at 5.75%.
5. No Rush to Cut Further
Though past rate cuts and CRR reductions are still taking effect, the RBI left the door open for future action depending on data. Economists see this as a balanced, India-focused approach.
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