India’s central bank maintains neutral stance, trims inflation forecast for FY2026-2027 while raising growth outlook.
The Reserve Bank of India left its key repo rate unchanged at 5.25% for the fourth consecutive meeting, aligning with expectations. The decision reflects a neutral policy stance as inflation pressures ease and growth prospects improve.
The RBI attributed recent inflation overshoots to supply-side factors and lowered its inflation projection for fiscal 2026-2027. Meanwhile, it revised upward its growth forecast, signaling confidence in economic momentum despite global uncertainties.
Markets showed muted reaction as the pause was widely anticipated, though the trimmed inflation outlook may support bond yields in the near term.