RBI Maintains Repo Rate at 5.25%, Holds On to Neutral Stance

The RBI is holding the repo rate steady at 5.25% at its April monetary policy meeting, according to RBI Governor Sanjay Malhotra on April 8. It also opted for a neutral stance at the Monetary Policy Committee meeting held on April 6-8.

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It was the first meeting for FY27. Alongside this, the RBI kept the standing deposit facility rate at 5% and the marginal standing facility rate, as well as the bank rate, at 5.5%.

According to the RBI, the policy decision comes amid global uncertainties, including volatility in crude oil prices and currency movements following geopolitical tensions in West Asia.

Growth Projections For FY27

The RBI has projected India’s real GDP growth at 6.9% for FY27. Quarterly growth estimates have been set at 6.8% for Q1, 6.7% for Q2, 7% for Q3, and 7.2% for Q4, as per the central bank’s policy statement.

The projections reflect steady economic activity supported by domestic demand conditions, according to the RBI.

Inflation Outlook

The central bank has projected consumer price index (CPI) inflation at 4.6% for FY27. Q1 growth estimates come to 4%, Q2 to 4.4%, Q3 to 5.2%, and Q4 to 4.7%.

The RBI also pointed out that although the inflation rate was in the targeted range, it kept an eye on fluctuations in the prices of international commodities, particularly crude oil.

Policy Context

This policy announcement came in the wake of the February 2026 announcement, where the repo rate had also been kept unchanged at 5.25%, despite 125 bps rate cuts in 2025, according to the RBI’s data.

The current monetary policy announcement has come at a time when the Indian currency is under pressure of depreciation due to geopolitical factors, and crude oil prices are high because of similar reasons.

The MPC maintained its neutral outlook, implying that it remains flexible to the prevailing macroeconomic scenario.

The RBI stated that it will continue to monitor the evolving economic data and take further steps accordingly.