RBI Governor Shaktikanta Das announced that the Monetary Policy Committee (MPC) decided by a 4:2 majority to keep the policy repo rate unchanged at 6.5%. As a result, the standing deposit facility (SDF) rate remains at 6.25%, while the marginal standing facility (MSF) rate and the bank rate are at 6.75%. The repo rate is the interest rate at which the RBI lends to commercial banks to address shortages of funds.

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Das highlighted ongoing concerns about food inflation, which remains elevated despite deflation in fuel prices. The RBI is committed to bringing inflation back to its target of 4% on a durable basis. He added that the MPC remains vigilant to external risks to inflation, particularly food inflation, as these could delay the path to disinflation.

The RBI projected real GDP growth for FY25 at 7.2%, an increase from the previous estimate of 7%. He noted that private consumption is recovering with steady discretionary spending in urban areas, and investment activity continues to gain traction, indicating positive economic momentum. RBI retained CPI inflation forecast for FY25 at 4.5%.

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