This is the third instance of the MPC keeping policy rates unchanged across the last four policies, having cut rates by 100 basis points across February, April, and June 2025.
The MPC also left the policy stance as “neutral.”
This is the first monetary policy decision, not just for 2026, but also after India signed two major trade agreements, one with the European Union and then with the US, all within a span of the last fortnight.
In his address, RBI Governor Sanjay Malhotra said that external headwinds have intensified, but despite that, the near-term domestic inflation and growth outlook remain positive.
However, the CPI outlook for the first and second quarter of financial year 2027 was raised to 4% and 4.2% respectively. Governor Malhotra attributed the marginal revision to the inflation outlook to the move seen in precious metals.
The Real GDP growth for the year was pegged at 7.4% compared to the previous year. The real GDP estimate for the first quarter of financial year 2027 was pegged at 6.9% and for the second quarter at 7%. The full year outlook was pushed to the April policy as a new GDP series will be launched soon.
Governor Malhotra added that the momentum in private consumption is expected to sustain, and that high capacity utilization, accelerating bank credit, and government’s continued to infra should give an impetus to investment activity.
This is breaking news. The story will be updated with more details.
