RBI Keeps Repo Rate Unchanged at 5.25%; Home and Auto Loan EMIs to Remain Stable
The Reserve Bank of India maintains the repo rate at 5.25%, citing global uncertainties, while raising India's FY27 GDP growth forecast to 6.7% and trimming inflation projections.
New Delhi | August 5, 2026 The Reserve Bank of India (RBI) has kept the repo rate unchanged at 5.25%, meaning borrowers with home and auto loans are unlikely to see any immediate change in their monthly EMIs.
Announcing the outcome of the latest Monetary Policy Committee (MPC) meeting, RBI Governor Sanjay Malhotra said the central bank has retained its neutral policy stance while keeping key policy rates unchanged. The Standing Deposit Facility (SDF) rate remains at 5.0%, while the Marginal Standing Facility (MSF) rate continues at 5.50%.
Explaining the decision, the governor pointed to persistent global uncertainties, particularly tensions in the Middle East, which have led to volatility in crude oil prices and continue to pose risks to the global economy.
The RBI noted that the repo rate had also been left unchanged in the previous MPC meeting held in June. During 2025, however, the central bank reduced the repo rate by a cumulative 125 basis points, providing significant relief to borrowers.
The repo rate is the interest rate at which the RBI lends money to commercial banks. Any change in this rate directly influences borrowing costs, affecting home loans, auto loans, and other lending rates. Since the repo rate has been left unchanged, existing loan EMIs are expected to remain stable unless individual banks revise their lending rates independently.
Despite global economic challenges, the RBI expressed confidence in India's growth outlook. The central bank revised its FY27 GDP growth forecast upward from 6.6% to 6.7%. It expects the economy to grow by 7.0% in the first quarter, while the second-quarter growth estimate has been raised from 6.3% to 6.4%.
On inflation, the RBI acknowledged that food and fuel prices, along with monsoon-related risks, continue to put pressure on retail inflation. However, it lowered its FY27 retail inflation forecast from 5.1% to 5.0%.
The quarterly inflation projections are 5.3% in Q1, 4.7% in Q2, 5.9% in Q3, and 5.5% in Q4, reflecting the RBI's expectation that inflation will remain manageable despite external uncertainties.
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