Reserve Bank of India Governor Sanjay Malhotra on Friday announced that the Monetary Policy Committee (MPC) has unanimously decided to keep the policy repo rate unchanged at 5.25 per cent while maintaining a neutral policy stance.
Announcing the decision, the Governor said the MPC arrived at its conclusion after a detailed assessment of evolving macroeconomic conditions and the overall economic outlook.
“Since the last policy meeting, external headwinds have intensified. However, the successful completion of recent trade deals augurs well for the economic outlook. Overall, the near-term domestic inflation and growth outlook remain positive,” Malhotra said.
With the repo rate unchanged, the Standing Deposit Facility (SDF) rate remains at 5 per cent, while the Marginal Standing Facility (MSF) rate and the Bank Rate continue at 5.5 per cent.
The MPC’s decision reflects a careful balancing of domestic economic conditions against global uncertainties. While growth and inflation trends at home remain supportive, the committee has remained cautious in view of global developments and shifting monetary policy signals from major economies.
Globally, monetary policy decisions by major central banks showed a clear divergence in February 2026. The U.S. Federal Reserve and the Bank of England kept their interest rates unchanged in their latest policy meetings, following a series of rate cuts during 2025.
In contrast, the Reserve Bank of Australia surprised financial markets by announcing its first interest rate hike in two years, signalling a shift in its policy approach.
On the inflation front, the latest data released by the Ministry of Statistics and Programme Implementation showed that year-on-year inflation based on the Consumer Price Index (CPI) stood at 1.33 per cent in December 2025 on a provisional basis, compared to the same month a year earlier.
The low inflation reading has provided comfort to policymakers, even as they remain watchful of potential risks arising from global developments.
The RBI reiterated that future policy actions will continue to be guided by incoming data and the evolving macroeconomic outlook, with a focus on maintaining price stability while supporting economic growth. (ANI)
