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- The Reserve Bank of India kept the key repo rate unchanged at 5.50% on Wednesday
- The rate-setting panel voted unanimously to maintain the repo rate and a "neutral" policy stance
- The RBI cut the repo rate by 100 basis points in the first half of 2025, but paused in August
Did our AI summary help? Let us know. Switch To Beeps Mode New Delhi: The Reserve Bank of India (RBI) kept its key repo rate unchanged at 5.50% on Wednesday, in line with market expectations, as it evaluates the impact of earlier rate cuts and recent tax reductions amid global trade uncertainties.
The central bank had cut the repo rate by a total of 100 basis points in the first half of 2025, but paused at its previous meeting in August.
The six-member rate-setting panel voted unanimously to keep the key repo rate at 5.50% and decided to continue with a "neutral" policy stance.
A Reuters poll had predicted rates would remain on hold, although some economists highlighted subdued inflation and risks to growth as reasons for a potential cut.
The MPC observed that the inflation outlook has turned more benign due to lower food prices and tax rate cuts, Governor Sanjay Malhotra said in his statement. The growth outlook remains resilient, he said.
India's annual inflation accelerated to 2.07% in August as food prices inched higher, but remained close to the lower end of the central bank's 2%-6% tolerance band, leaving room for rate cuts.
Despite stronger-than-expected economic growth of 7.8% in the April-June quarter from a year earlier, economists foresee a slowdown in subsequent quarters, partly due to US tariffs of up to 50% on Indian imports. However, reduced taxes on a swath of consumer goods are expected to bolster domestic demand.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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