RBI MPC Holds Repo Rate Unchanged at 5.25% Amid Global Uncertainty
The Reserve Bank of India's Monetary Policy Committee (MPC) decided to keep the repo rate unchanged at 5.25% during its latest bi-monthly review, maintaining a neutral monetary policy stance. Governor Sanjay Malhotra noted that the growth-inflation tradeoff has shifted adversely in the near term due to geopolitical tensions in West Asia, rising crude oil prices near $100/barrel, and disruptions in the Strait of Hormuz. The decision signals the RBI's cautious approach to balancing growth support with inflation risks from elevated energy costs.
Key Facts & Details
7 points- 1RBI MPC keeps repo rate unchanged at 5.25% — neutral stance maintained
- 2Governor Sanjay Malhotra warns of adverse growth-inflation tradeoff
- 3West Asia conflict and Strait of Hormuz disruptions driving crude above $100/barrel
Deep Dive
- +This is the first MPC meeting of FY2026-27 (FY27)
- +Rising oil prices threaten India's current account deficit and import bill
- +The Indian rupee has been under pressure, recording its steepest weekly fall since September 2022
- +Economists expect the RBI to resume rate cuts once geopolitical risks ease
Exam Focus
Likely MCQ: What is India's current repo rate after the April 2026 MPC meeting? → Answer: 5.25%
Related Topics
Exam Relevance & Angle
Core Banking Awareness topic: RBI Monetary Policy, Repo Rate, and MPC decisions are frequently tested in all banking exams.
Target Exams
Background & Context
The Monetary Policy Committee (MPC) is a six-member statutory body constituted under Section 45ZB of the amended RBI Act, 1934. It meets at least four times a year (bi-monthly) to set the benchmark interest rate — the repo rate — which is the rate at which the RBI lends short-term funds to commercial banks.
The MPC comprises three internal members (the RBI Governor as chairperson, a Deputy Governor, and one RBI official) and three external members appointed by the Government of India. Decisions are taken by majority vote, with the Governor having a casting vote in case of a tie.
Key policy rates students must know: Repo Rate (currently 5.25%), Reverse Repo Rate, Marginal Standing Facility (MSF) Rate, Bank Rate, CRR, and SLR. The neutral stance means the MPC can move rates in either direction depending on evolving economic conditions.
Related GK Concepts
Must KnowTest Yourself
1 / 3Who is the current Governor of the Reserve Bank of India as of April 2026?
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