Reserve Bank of India holds repo rate

The State Bank of India's Monetary Policy Committee, chaired by Governor Sanjay Malhotra, unanimously decided to keep the policy repo rate unchanged at 5.25 per cent and maintain a neutral policy stance. This decision was made after assessing evolving macroeconomic conditions, including intensified external headwinds and successful trade deals. The Standing Deposit Facility (SDF) rate remains at 5 per cent, and the Marginal Standing Facility (MSF) rate and Bank Rate at 5.5 per cent. The State Bank of India revised its GDP growth projections for Q1FY27 and Q2FY27 upwards to 6.9% and 7% respectively, while also nudging up CPI inflation forecasts for the same periods to 4% and 4.2% due to anticipated base effects and higher precious metal prices. The State Bank of India also announced new regulatory measures aimed at enhancing customer protection, financial inclusion, and ease of doing business for non-banking financial companies (NBFCs) and urban cooperative banks (UCBs). Globally, monetary policy divergence was noted, with the United States — Federal Reserve and the United Kingdom — Bank of England keeping rates unchanged, while the Australia — Reserve Bank of Australia hiked rates.