RBI Repo Rate: Due to reduced inflation pressure, the Reserve Bank of India (RBI) may reduce the key policy rate repo by 0.25 percent in its upcoming monetary policy meeting. However, some experts believe that the central bank may keep the interest rates stable in view of the better than expected 8.2 percent GDP growth in the second quarter.
Retail inflation based on Consumer Price Index has been below the lower limit of the government’s range (two percent) for the last two months.
expert opinion
Some experts believe that due to the boom in the economy, RBI can keep the interest rates unchanged. This uptick is supported by various reforms like fiscal consolidation, targeted public investment and GST rate cut. The Monetary Policy Committee (MPC) meeting is to be held from 3-5 December 2025.
RBI Governor Sanjay Malhotra will announce the decisions of the committee on December 5. The central bank had started reducing the rates in February last year and reduced the repo rate by a total of one percent to 5.5 percent. The cuts were stopped in August. According to some experts, due to reduced inflation pressure, RBI may cut the key policy rate by 0.25 percent in the upcoming monetary policy meeting.
hdfc bank report
According to a report by HDFC Bank, this year growth is higher than expected and inflation is lower than expected. According to this, “Therefore there will be a tough competition in the upcoming decision of RBI.” “Given the risks to growth in the second half and the expectation that inflation will remain well below four percent by the third quarter of fiscal year 2026-27, we believe that there could be another 0.25 percent rate cut in the upcoming policy rate meeting.”
A research report by the Economic Research Department of the State Bank of India said that with strong GDP growth and minimal inflation, the RBI now has to convey the rate direction to the broader markets in the MPC meeting to be held this week. Madan Sabnavis, Chief Economist of Bank of Baroda, said that there will be a tough competition on the repo rate in the upcoming policy. Since the monetary policy is forward thinking and accordingly the policy rate seems to be at an appropriate level at this time.
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