RBI MPC key takeaways: Here are the major announcements by Governor Sanjay Malhotra on GDP, inflation and repo rate

The Reserve Bank of India today kept interest rates unchanged at 5.25% and maintained a neutral policy stance, signalling continuity, as it grapples with a sharply weaker rupee while trying to support economic growth.

The MPC on Friday flagged a deteriorating global environment marked by geopolitical tensions, supply chain disruptions and heightened market volatility, even as it expressed confidence in India's ability to withstand these shocks.

Also read: Why the RBI kept rates unchanged amid oil, rupee and geopolitical pressures



"We remain confident to withstand these shocks with minimum pain," Malhotra said, adding that it was important to not just confront these challenges but also use them as an opportunity to enhance India's resilience.

The governor noted that the Indian economy had entered this episode of global turbulence in a much stronger position compared to previous such episodes.

On the global outlook, Malhotra said the environment had "deteriorated" with the conflict in West Asia lingering amid a fragile truce, sharply escalating energy prices, and continued supply chain disruptions hindering economic activity. "The global economic outlook remains clouded," he said.

Here is a quick look at the takeaways from the MPC:

Repo rate

The RBI held its key repo rate steady at 5.25% in its first policy meeting since the outbreak of the Iran conflict. All six members of the Monetary Policy Committee, comprising three RBI officials and three external experts, voted unanimously to maintain the rate, while the MPC retained its "neutral" policy stance.

Also read: RBI Inflation FY2026-27: The inflation battle is back as RBI raises FY27 forecast to 5.1% amid West Asia war

GDP outlook

The Reserve Bank of India revised its FY27 real GDP growth forecast down to 6.6%, from an earlier projection of 6.9%, even as it warned that the Iran war, higher oil prices and geopolitical tensions could weigh on the outlook.

The central bank now expects GDP growth of 6.6% in the first quarter, 6.3% in the second quarter, 6.5% in the third quarter and 6.8% in the fourth quarter of FY27.

Inflation outlook

Amid global uncertainties, the RBI has forecasted inflation at 5.1% for the fiscal year 2026-27, as against 4.6% forecasted in the April meeting. The central bank now expects GDP growth of 6.6% in the first quarter, 6.3% in the second quarter, 6.5% in the third quarter and 6.8% in the fourth quarter of FY27.

Forex

India’s foreign exchange reserves stood in a very healthy $682.3 billion as of June 5, RBI Governor said, signaling a recovery after recent sharp declines caused by currency market interventions. He added, "our forex reserves provide sufficient buffer against external shocks.