Citing high levels of global uncertainty, the Reserve Bank of India (RBI) on Wednesday decided to maintain a status quo on policy rates. Governor Sanjay Malhotra announced that the Monetary Policy Committee (MPC) unanimously voted to keep the repo rate unchanged at 5.25%. Notably, the benchmark lending rate has remained static since December 2025.

The Governor highlighted that escalating geopolitical tensions, particularly the conflict in West Asia, have injected volatility into the markets. To safeguard the Indian economy from external shocks, the MPC opted for a cautious approach. Consequently, the Standing Deposit Facility (SDF) rate remains at 5%, while the Marginal Standing Facility (MSF) and the Bank Rate stay at 5.5%. The RBI has also maintained its ‘neutral’ policy stance.

Governor Malhotra emphasized that while India’s growth momentum remains strong—driven by robust consumption and investment—inflationary risks are looming. Rising crude oil prices and climate-related fluctuations in food prices pose a direct threat to price stability. “Headline inflation is currently below target, but upside risks have increased significantly,” the Governor remarked. For now, the RBI remains committed to a balanced strategy, monitoring supply chain disruptions closely while ensuring that the domestic economy continues its upward trajectory despite global headwinds.