Perspective on RBI MPC Announcement by Mahendra Patil, Founder and Managing Partner, MP Financial Advisory Services LLP
Below the Perspective on RBI MPC Announcement by Mahendra Patil, Founder and Managing Partner, MP Financial Advisory Services LLP
“RBI Holds Repo Rate Steady: Implications for Economy, Consumption and Corporates
The Reserve Bank of India, in its October 2025 Monetary Policy Report, kept the repo rate unchanged at 5.5%, reflecting confidence in India’s growth trajectory while maintaining price stability. With inflation at multi-year lows and expected to average 2.6% in FY2025-26, the pause allows the economy to absorb the benefits of earlier rate cuts.
For households, this stability reinforces the emerging consumption boost, supported by low inflation, GST rationalisation, and easier access to credit. Rural optimism and urban discretionary demand are set to strengthen further in H2 FY2026.
For corporates, the RBI’s neutral stance comes at a time of improving credit conditions and sovereign rating upgrades (R&I to BBB+ and S&P to BBB), which together reduce borrowing costs and enhance balance sheet resilience. Rating agencies are already reflecting stronger credit ratios across sectors, signalling improved financial health.
Overall, the RBI’s stance of continuity, combined with fiscal and structural reforms, positions India to sustain growth above 6.5% while reinforcing its image as a resilient, consumption-driven economy.”
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