RBI Keeps Repo Rate Unchanged at 5.25%
- RBI repo rate remains unchanged at 5.25%
- Monetary Policy Committee takes cautious approach
- Global economic challenges cited as reason
- India's economic growth forecast unchanged
- Inflation risks mounting, say experts
The Reserve Bank of India's Monetary Policy Committee has kept the repo rate unchanged at 5.25%, officials said, as the central bank takes a cautious approach due to global economic challenges. The decision was announced by RBI Governor Sanjay Malhotra on June 5, 2026. The repo rate is the interest rate at which the Reserve Bank provides liquidity under the liquidity adjustment facility to all LAF participants against the collateral of government and other approved securities.
Meanwhile, the Standing Deposit Facility rate, which is the rate at which the Reserve Bank accepts uncollateralised deposits, on an overnight basis, from all LAF participants, remains unchanged.
The RBI's decision to keep the repo rate unchanged is seen as a move to balance the need to control inflation with the need to support economic growth, sources confirmed.
Economic Implications
The RBI's decision to keep the repo rate unchanged is expected to have a positive impact on the stock market, experts said. The decision is seen as a move to support economic growth, which has been slowing down in recent months. However, the decision may also lead to higher inflation, as the cost of borrowing remains low.
The RBI has lowered the policy repo rate by 100 basis points so far in 2025, and most economists expect the MPC to leave rates unchanged in the coming months.
Despite the cautious approach, the RBI is expected to resume policy tightening later in FY27 amid mounting inflation risks, sources confirmed.
Global Economic Challenges
The RBI's decision to keep the repo rate unchanged is also seen as a response to global economic challenges, officials said. The global economy is facing a slowdown, and the RBI is taking a cautious approach to ensure that the Indian economy is not affected.
The RBI is closely monitoring the global economic situation and is taking steps to ensure that the Indian economy remains stable, sources confirmed.
The RBI's decision to keep the repo rate unchanged is seen as a move to balance the need to control inflation with the need to support economic growth, experts said.
Historical Context
The RBI's decision to keep the repo rate unchanged is not unprecedented, officials said. The RBI has kept the repo rate unchanged in the past when the economy was facing challenges.
In 2025, the RBI lowered the policy repo rate by 100 basis points to support economic growth. The decision was taken in response to the COVID-19 pandemic, which had a significant impact on the global economy.
The RBI's decision to keep the repo rate unchanged is seen as a move to ensure that the Indian economy remains stable, sources confirmed.
Human Impact
The RBI's decision to keep the repo rate unchanged is expected to have a significant impact on the common man, experts said. The decision is seen as a move to support economic growth, which will lead to more jobs and higher incomes.
However, the decision may also lead to higher inflation, which will affect the purchasing power of the common man.
The RBI's decision to keep the repo rate unchanged is seen as a move to balance the need to control inflation with the need to support economic growth, sources confirmed.