RBI MPC August: Central Bank Projects GDP Growth At 6.5% For FY26

Announcing the outlook, RBI Governor Sanjay Malhotra said that the Monetary Policy Committee (MPC) remains confident in the resilience of the domestic economy

Sanjay Malhotra said, "Over the medium term, the Indian economy holds bright prospects in the changing world order, drawing on its inherent strengths"

Source : ABPLIVE AI

The Reserve Bank of India (RBI) has retained its GDP growth forecast for the financial year 2025–26 at 6.5 per cent, with quarterly projections at 6.5 per cent for Q1, 6.7 per cent for Q2, 6.6 per cent for Q3, and 6.3 per cent for Q4. Announcing the outlook, RBI Governor Sanjay Malhotra said that the Monetary Policy Committee (MPC) remains confident in the resilience of the domestic economy.

Additionally, RBI has maintained the repo rate at 5.5 per cent and retained its policy stance as 'Neutral'. Announcing the decision, RBI Governor Sanjay Malhotra said the MPC voted unanimously to keep rates unchanged, following a cumulative 100 basis points cut earlier this year. He also warned that inflationary pressures are expected to rise in the coming months. The MPC met on August 4, 5, and 6 to review the current economic and financial conditions before finalising its decision. The RBI Governor noted, "After a detailed assessment of the evolving macroeconomic and financial developments and outlook, the MPC voted unanimously to keep the policy rate under the Liquidity Adjustment Facility unchanged at 5.5 per cent."

Sanjay Malhotra said, "Over the medium term, the Indian economy holds bright prospects in the changing world order, drawing on its inherent strengths."

The RBI will continue to closely track economic indicators and inflation trends to guide its future policy decisions. The next meeting of the MPC is scheduled to take place from September 29 to October 1, 2025.

Previous MPC Meeting

The latest policy decision follows the Monetary Policy Committee’s 50 basis point rate cut in June, which brought the repo rate down to 5.5 per cent amid easing inflationary pressures. At the time, RBI Governor Sanjay Malhotra stated that inflation—both in the short and medium term—had retreated into the central bank’s comfort zone, providing greater policy flexibility. He also pointed out that a drop in food inflation had further supported the RBI’s accommodative stance.