Key RBI policy meeting underway: Experts anticipate steady repo rate

Mumbai: The three-day monetary policy committee (MPC) meeting of the Reserve Bank of India (RBI) begins on Wednesday, with policymakers set to review the nation’s economic outlook and determine the future course of monetary policy. The final decision will be announced by RBI Governor Sanjay Malhotra on Friday at 10 am.

During the meeting, MPC members will assess the latest data on GDP growth and inflation. India’s economy has remained robust, with GDP expanding 8.2 per cent in the second quarter of the 2025-26 financial year, surpassing expectations. At the same time, inflation has eased sharply, with retail inflation falling to a record low of 0.25 per cent in October, according to the Ministry of Statistics and Programme Implementation (MoSPI).

A report by Bank of Baroda suggests the central bank is expected to maintain the repo rate at 5.50 per cent, keeping its policy stance neutral. The report noted that price pressures have moderated significantly, largely due to a sustained decline in food prices, and inflation could fall even below RBI projections in the coming months.

Despite the possibility of a rate cut, analysts say the RBI is likely to exercise caution. “Both these developments (of a continued strong GDP growth and multi-year low inflationary levels) are mutually opposing forces from an interest rate perspective. Central banks usually do not tend to cut interest rates during periods of strong economic activity, represented by GDP growth. At the same time, the central banks usually respond to a low inflationary environment by cutting interest rates.”

The MPC meeting is scheduled to run from December 3 to 5, with the policy outcome set to be announced on December 5 at 10 am by Governor Sanjay Malhotra.

ANI inputs