• Source:JND
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RBI MPC Meeting 2025: The Reserve Bank of India (RBI) on Wednesday announced its monetary policy decision. The Central Bank kept the repo rate unchanged at 5.5 per cent. The decision was taken at the fourth bi-monthly meeting of the Monetary Policy Committee (MPC) for FY26, chaired by RBI Governor Sanjay Malhotra.

Assessment Of Growth Of Real Gross Domestic Product (GDP)

"The economic activity has remained resilient with growth of real gross domestic product (GDP) surprising on the upside at 7.8 per cent and gross value added (GVA) at 7.6 per cent for Q1: 2025-26.1 As suggested by high frequency indicators available so far, domestic economic activity continues to sustain momentum in Q2:2025-26.29," RBI Said in a statement.

Looking ahead, an above normal monsoon, good progress of kharif sowing and adequate reservoir levels have further brightened prospects of agriculture and rural demand, it added. "Buoyancy in services sector coupled with steady employment conditions are supportive of demand, which is expected to get a further boost from the rationalisation of GST. Rising capacity utilisation, conducive financial conditions, and improving domestic demand should continue to facilitate fixed investment," the Central bank stated.

"However, ongoing tariff and trade policy uncertainties will impact external demand. Prolonged geopolitical tensions and volatility in international financial markets caused by risk-off sentiments of investors pose downside risks to the growth outlook. The implementation of several growth-inducing structural reforms, including streamlining of GST are expected to offset some of the adverse effects of the external headwinds," it added.

"Taking all these factors into account, real GDP growth for 2025-26 is now projected at 6.8 per cent, with Q2 at 7.0 per cent, Q3 at 6.4 per cent, and Q4 at 6.2 per cent. Real GDP growth for Q1:2026-27 is projected at 6.4 per cent. The risks are evenly balanced," the RBI said.

Here Are The Highlights From The RBI Governor's Statement

- The MPC decides to keep monetary policy stance unchanged at 'neutral', said the RBI Governor.

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- The economic growth outlook remains resilient helped by favourable monsoon, lower inflation and monetary easing, said Malhotra.

- Domestic economic activities continue to sustain momentum in the second quarter of this fiscal, said the RBI Governor.

- Tariff-related development likely to decelerate growth in second half of this fiscal, said the RBI Governor.

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- GST and other reforms are to offset impact of external factors on economic growth to some extent, said RBI Governor Malhotra.

- India's forex reserves at USD 700.2 billion, enough to cover 11 months of imports, said the RBI Governor.

- RBI projects inflation at 2.6 per cent for FY26, lower than earlier estimate of 3.1 per cent.

Sensex, Nifty See Spike After RBI Monetary Policy Decision Announcement

The stock market held gains moments after the RBI kept the repo rate unchanged for the second consecutive time. The Nifty 50 was up 0.18% at 24,652.7 and the BSE Sensex added 0.17% to 80,401.31, as of 10.15 am. Both the benchmarks traded about 0.25% higher ahead of the RBI rate decision. Ten of the 16 major sectors advanced, with rate sensitives such as financials, auto, and consumer and reality pairing some of the early gains.

(With PTI inputs)