Higher GDP, Lower Inflation To Liquidity Support: Major Highlights From December RBI MPC Meet

RBI has intensified customer service initiatives, including Re-KYC drives, financial inclusion measures, and the “Aapki Poonji, Aapka Adhikar” campaign.

RBI MPC delivered a 25 bps rate cut, bringing the repo rate to 5.25 per cent, while maintaining a neutral stance.

Source : PTI

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Key points generated by AI, verified by newsroom

• RBI cut repo rate by 25 bps to 5.25%, maintaining neutral stance.
• FY26 GDP growth forecast raised to 7.3%; inflation forecast cut.
• RBI to inject liquidity via OMOs and rupee buy-sell swap.

The Reserve Bank of India (RBI) on Friday announced its decision to cut the repo rate by 25 basis points (bps) by its six-member panel or its Monetary Policy Committee (MPC) after a three-day meeting which started on December 3 to conclude today.

Here are some key highlights from central bank's Governor Sanjay Malhotra's address:

Repo Rate

• RBI MPC delivered a 25 bps rate cut, bringing the repo rate to 5.25 per cent, while maintaining a neutral stance.
• SDF revised to 5 per cent.
• MSF and Bank Rate adjusted to 5.5 per cent.

GDP Growth Forecast

• FY2025–26 growth outlook raised to 7.3 per cent, up from 6.8 per cent estimated in October.
• RBI projects 6.7 per cent growth for Q1 FY27 and 6.8 per cent for Q2 FY27.
• Services exports remain strong, merchandise exports face external headwinds, and overall growth is supported by robust domestic demand.

Inflation

• Headline inflation has fallen sharply and is expected to stay softer than earlier projections.
• FY26 inflation forecast cut to 2 per cent (a 0.6-point downward revision).
• Inflation for Q2 FY27 is projected at 4 per cent.
• Malhotra noted that Q2 FY26 inflation averaged 1.7 per cent, breaching the 2 per cent lower tolerance band, and dropped further to 0.3 per cent in October 2025, even as GDP growth hit 8.2 per cent.
• Improved food supplies, strong reservoir levels, favourable soil moisture and easing global commodity prices are aiding disinflation.

RBI's Liquidity Push

• RBI to undertake Rs 1 lakh crore OMO purchases and a $5 billion, three-year buy–sell swap in December to bolster durable liquidity.
• Policy stance remains neutral.

RBI's Focus On Consumers

• Surge in customer complaints has increased pendency with the RBI Ombudsman.
• Malhotra urged regulated entities to prioritise customer-centric practices and reduce grievances.
• A two-month campaign from 1 January aims to clear all Ombudsman cases pending for over a month.

Bank Credit Rises

• Bank credit has accelerated, supported by strong lending to retail and services sectors.
• Credit to MSMEs remains buoyant, and large industries have also seen improved credit offtake.

RBI KYC Drive

• RBI has intensified customer service initiatives, including Re-KYC drives, financial inclusion measures, and the “Aapki Poonji, Aapka Adhikar” campaign.
• The Citizens Charter was reviewed earlier this year to improve service standards.
• All applications for RBI services are now fully online.
• Monthly disclosures of disposal and pendency data are published on the 1st of every month, with over 99.8 per cent of applications resolved within stipulated timelines.

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