RBI Holds Repo Rate Steady At 5.25% In First FY27 Policy Amid West Asia Ceasefire Developments

The Reserve Bank of India on Wednesday kept the policy repo rate unchanged at 5.25% in its first monetary policy decision for FY 2026–27, citing global uncertainties and rising geopolitical tensions.

RBI Governor Sanjay Malhotra said the Monetary Policy Committee (MPC) unanimously decided to maintain the repo rate under the liquidity adjustment facility at 5.25%. Accordingly, the Standing Deposit Facility (SDF) rate remains at 5%, while the Marginal Standing Facility (MSF) rate and bank rate stay at 5.5%.

The MPC met from April 6 to 8 to evaluate macroeconomic and financial conditions before taking the decision. The central bank noted that the global economy is currently facing challenges due to geopolitical tensions, especially the ongoing conflict in West Asia, along with supply chain disruptions.

The Governor highlighted that while India’s economy showed strong growth and low inflation earlier, conditions turned less favourable in March as global tensions intensified. However, he maintained that India’s economic fundamentals remain strong and better positioned than during past crises.

He also pointed out that global growth faces downside risks due to rising energy costs and supply shortages, which have increased inflation concerns. Financial markets have turned volatile, with a stronger US dollar putting pressure on other currencies, while equities have corrected and bond yields have risen amid inflation and fiscal concerns.

(Inputs From ANI)

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