The Reserve Bank of India (RBI) announced its monetary policy today, 6 August 2025. This was the third bi-monthly Monetary Policy Committee (MPC) meeting for FY26, chaired by the RBI Governor Sanjay Malhotra.
The RBI MPC decided to keep the repo rate unchanged at 5.50%, having already frontloaded easing through both a rate cut and a 100 bps CRR reduction earlier this year. The policy stance also remains ‘Neutral’.
Consequently, the standing deposit facility (SDF) rate under the liquidity adjustment facility (LAF) remains unchanged at 5.25%, the marginal standing facility (MSF) rate, and the Bank Rate at 5.75%. This decision is in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2 per cent, while supporting growth.
In the June RBI policy, the central bank’s MPC surprised with a bumper 50 basis points (bps) cut in the repo rate to 5.50% from 6%. The MPC changed the policy stance to ‘Neutral’ from ‘Accommodative’, and slashed the Cash Reserve Ratio (CRR) by 100 bps to 3% from 4% earlier.
