RBI MPC Meet HIGHLIGHTS: No change in rates –Governor Sanjay Malhotra says ‘geopolitical tensions pose risks to the growth outlook’

CPI headline inflation declined for the eighth consecutive month to a 77-month low of 2.1 per cent (YoY) in June 2025. The RBI governor said, “This was driven primarily by a sharp decline in food inflation led by improved agricultural activity and various supply side measures. Food inflation recorded its first negative print since February 2019 at (-) 0.2 per cent in June. High-frequency price indicators signal a continuation of the lower price momentum in food prices this year to July as well.”

Further, core inflation, which remained within a narrow range of 4.1-4.2 per cent during February-May, increased to 4.4 per cent in June, driven partly by a continued increase in gold prices.

As for the growth outlook, RBI Governor Sanjay Malhotra said, “…the above normal southwest monsoon, lower inflation, rising capacity utilization and congenial financial conditions continue to support domestic economic activity. The supportive monetary, regulatory and fiscal policies including robust government capital expenditure should also boost demand.”

RBI Governor Sanjay Malhotra said that domestic growth remained resilient and is broadly evolving along the lines of our assessment. “Private consumption, aided by rural demand, and fixed investment, supported by buoyant government capex, continue to boost economic activity,” he said.

On the supply side, Malhotra added, a steady south-west monsoon is supporting kharif sowing, replenishing reservoir levels and boosting agriculture activity. Moreover, the services sector and construction activity remain robust.

However, he said, growth in the industrial sector remained subdued and uneven across segments, pulled down by electricity and mining.

The Nifty Bank has turned positive after the Reserve Bank of India kept the repo rate unchanged at 5.5%. The banking stocks were trading on a flat note with a negative bias, but soon turned green. The RBI MPC also maintained its ‘Neutral’ stance. It was the only sectoral index to trade in the green. Kotak Mahindra Bank and State Bank of India surged the most, rising 0.9% and 0.3% respectively.

RBI Governor Sanjay Malhotra said that the prospects of external demand remain uncertain amidst ongoing tariff announcements and trade negotiations. “The headwinds emanating from prolonged geopolitical tensions, persisting global uncertainties, and volatility in global financial markets pose risks to the growth outlook,” he added.

RBI Governor Sanjay Malhotra said, “The global environment continues to be challenging. Although financial market volatility and geopolitical uncertainties have abated somewhat from their peaks in recent months, trade negotiation challenges continue to linger.” Global growth, he added, remained muted.

After assessing the current and evolving macroeconomic situation, RBI Governor Sanjay Malhotra said that the MPC voted to maintain the policy repo rate at 5.50 per cent. Consequently, the standing deposit facility (SDF) rate under the liquidity adjustment facility (LAF) remained unchanged at 5.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 5.75 per cent.

FY26: Revised to 3.1% from earlier 3.7%

Q2FY26: Revised to 2.1% from earlier 3.4%

Q3FY26: Revised to 3.1% from earlier 3.9%

Q4FY26: Maintained at 4.4%

Q1FY27: 4.9%

The RBI has revised downwards its FY26 CPI inflation forecast to 3.1 per cent from the 3.7 per cent targeted earlier, Governor Sanjay Malhotra said.

RBI Governor Sanjay Malhotra said that the impact of a 100 bps rate cut is still unfolding. The MPC had previously cut rates in both February, April and June 2025, and has already brought the repo rate down by 100 bps to 5.5 per cent.

Real GDP growth for FY26 at 6.50%

Q1: 6.5 per cent

Q2: 6.7 per cent

Q3: 6.6 per cent

Q4: 6.3 per cent

“The real GDP growth for Q1FY27 is projected at 6.6%. The risks are evenly balanced,” said the RBI governor.

RBI Governor Sanjay Malhotra said, “Headline inflation is much lower than projected earlier due to volatile food prices.” While maintaining that core inflation has remained steady around the 4 per cent mark, he added that inflation is expected to go up from the last quarter of this fiscal.

RBI Governor Sanjay Malhotra said that the 6-member MPC has decided to maintain the policy stance as ‘Neutral’.

After its three day deliberations, RBI MPC led by Governor Sanjay Malhotra announced that the repo rate will remain unchanged at 5.50 per cent. “Geopolitical uncertainty somewhat abated,” he said.

In the June meeting, the MPC had announced a 50 bps cut in the key interest rate. After its three day deliberations, RBI MPC led by Governor Sanjay Malhotra announced that the repo rate will remain unchanged at 5.50 per cent.

In the June meeting, the MPC had announced a 50 bps cut in the key interest rate.

It’s time! The three-day MPC meeting ended today. RBI Governor Sanjay Malhotra has started his speech and will announce the much-awaited decision taken by the RBI MPC on the key interest rate. According to economists, a status quo on the repo rate looks likely. All eyes are on repo rate, inflation forecast, GDP growth estimates, among other economic indicators.

With the RBI MPC ending its three-day deliberations today, the Governor will announce the decision on the key interest rate today. Sanjay Malhotra will start his speech at 10:00 am. Stay tuned!

Anand Rathi expects the central bank to maintain a pause on rate cuts while keeping a neutral policy stance. With inflation falling sharply—June CPI at just 2.1 per cent—and liquidity in surplus, the central bank is likely to assess the full impact before initiating further action, Anand Rathi said.

In its February 2025 policy meeting, the RBI cut the repo rate by 25 basis points to 6.25 per cent. This marked the first rate cut in nearly five years. The RBI kept its policy stance “neutral”. This was the first meeting under the leadership of Governor Sanjay Malhotra.

In its April 2025 MPC meeting, held on April 9, the RBI cut the repo rate by 25 basis points to 6.00 per cent. Simultaneously, the MPC shifted its policy stance from “neutral” to “accommodative”. The RBI also revised its GDP projection downward from 6.7 per cent to 6.5 per cent for FY 2025‑26.

In its June 2025 policy meeting, the RBI retained its GDP forecast for FY 2025-26 at 6.5 per cent, stating that the risks were evenly balanced. The inflation outlook for the year was revised downwards to 3.7 per cent. GDP growth was expected to remain subdued amidst global challenges.

In its June 2025 policy meeting, the RBI slashed the repo rate by 50 basis points to 5.50 per cent and cut the Cash Reserve Ratio (CRR) by 100 basis points to 3 per cent. The Monetary Policy Committee (MPC) also shifted its stance from ‘accommodative’ to ‘neutral’, signaling a more balanced policy approach going forward.

The RBI’s three-day Monetary Policy Committee (MPC) meeting wraps up today, with Governor Sanjay Malhotra scheduled to announce the policy decision at 10:00 am. The announcement will be broadcast live on the RBI’s official YouTube channel. For real-time updates and expert insights, audiences can tune in to leading financial news platforms such as FinancialExpress.com and follow coverage across social media.

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In March, the central bank had released its meeting schedule for FY26. The six scheduled MPC meetings for FY26 are as follows:

April 7-9, 2025

June 4-6, 2025

August 5-7, 2025

September 29-October 1, 2025

December 3-5, 2025

February 4-6, 2026

The RBI’s Monetary Policy Committee (MPC), headed by Governor Sanjay Malhotra, consists of six-members. This includes three external members. In October, the Centre had appointed three new external members – Saugata Bhattacharya, Economist; Dr Nagesh Kumar, Director and Chief Executive, Institute for Studies in Industrial Development; and Professor Ram Singh, Director, Delhi School of Economics, University of Delhi. The three internal members are Chairperson Sanjay Malhotra, RBI Executive Director Dr Rajiv Ranjan, and Deputy Governor M Rajeshwar Rao.

RBI Governor Sanjay Malhotra will announce the decision on the key interest rate today at 10:00 am. The RBI’s Monetary Policy Committee (MPC) conducted its bi-monthly policy meeting starting August 4 and the decision will be announced today.

Greetings! We, at FinancialExpress.com, are all set to bring to you blow-by-blow updates on the RBI MPC decision to be announced by Governor Sanjay Malhotra at 10:00 am today. Stay tuned for all the updates, key expectations and also market reactions to the decision announced by the central bank.