3 weeks ago

RBI MPC holds repo rate, flags inflation and geopolitical risks

RBI MPC holds repo rate, flags inflation and geopolitical risks
On hold, on guard - Opinion News · financialexpress.com

This story is about a meeting of India's central bank, the Reserve Bank of India.

The bank decides the interest rate, which is the cost of borrowing money.

At this meeting, the bank decided to keep the main interest rate the same.

That means it did not go up or down.

The bank is being careful because the prices of some things are going up.

Prices going up is called inflation, and the bank tries to keep it from getting too high.

One big reason prices are rising is that oil has become more expensive because of a conflict in West Asia.

The article says India's economy is still growing, but a little more slowly than last year.

It also says the bank might raise the interest rate later this year if prices keep rising or the weather turns bad.

Raising interest rates is a way the bank can help slow down inflation.

Key facts

Decision
Repo rate and policy stance retained (unchanged)
June headline consumer inflation
Above 4%, crossing the midpoint of the RBI's tolerance band
June core inflation
3.9%; 2.5% excluding precious metals
Forecast revisions vs June
Growth +10 basis points; inflation -10 basis points
Crude oil assumption
$82-87 per barrel this fiscal vs $70 last fiscal
India GDP growth forecast
6.6% this fiscal vs 7.7% last fiscal
Global GDP growth (IMF)
3.0% in 2026 vs 3.5% in 2025
Foreign capital inflows (RBI schemes)
Over $40 billion by end-July

Sources

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