On 8 April 2026, the Reserve Bank of India (‘RBI’) released its Monetary Policy Statement for 2026-27 following the 60th meeting of the Monetary Policy Committee (‘MPC’) held from April 6 to 8, 2026, under the chairmanship of Mr. Sanjay Malhotra, Governor, RBI.
After assessing domestic and global economic developments, the MPC unanimously decided to keep all policy rates unchanged. The policy repo rate remains at 5.25%, and the MPC has continued with a neutral policy stance. These policy decisions take effect immediately.
Key Policy Decisions:
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The MPC unanimously decided to keep the policy repo rate unchanged at 5.25% under the Liquidity Adjustment Facility (LAF).
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Consequently:
○ Standing Deposit Facility (SDF) Rate: 5.00%
○ Marginal Standing Facility (MSF) Rate & Bank Rate: 5.50%
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The MPC also continued with the ‘neutral’ policy stance.
Rationale Behind the Decision:
The MPC noted heightened global geopolitical risks, particularly due to the ongoing conflict in West Asia, which has disrupted supply chains and led to volatility in energy and commodity prices. While headline inflation currently remains below the RBI’s target, rising global uncertainties pose upside risks to inflation and may also weigh on economic growth.
Given that the current shock is largely supply side driven, the MPC considered it appropriate to pause on rate action, while closely monitoring evolving domestic and global developments.
Growth Outlook:
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GDP Growth for 2025-26: Estimated at 7.6%
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GDP Growth Projection for 2026-27: 6.9%
Growth is expected to be supported by strong domestic demand, a resilient services sector, improving manufacturing capacity utilisation, and government measures to boost domestic manufacturing.
Inflation Outlook:
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CPI Inflation Projection for 2026-27: 4.6%
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Inflation risks continue to move upwards due to:
○ Volatile global energy prices
○ Supply chain disruptions
○ Possible weather-related disturbances
However, core inflation remains low, suggesting that underlying price pressures are under control.
The next meeting of the MPC is scheduled to be held from June 3 to 5, 2026.
[Monetary Policy Statement, 2026-27 (Monetary Policy Committee) April 6 to 8, 2026]
