RBI Holds Repo Rate At 5.25%, What's Next For EMIs, Borrowers & The Economy?

The Reserve Bank of India has kept the repo rate unchanged at 5.25% for the third consecutive policy meeting, with the Monetary Policy Committee unanimously retaining its neutral stance. While the RBI raised its FY27 GDP growth forecast to 6.7%, it lowered its inflation projection to 5%, signalling confidence in domestic growth despite global uncertainties and the ongoing West Asia conflict. In this detailed analysis, Madan Sabnavis, Chief Economist, Bank of Baroda, and Aditi Nayar, Chief Economist, ICRA, decode the RBI’s policy decision, its impact on EMIs, home and auto loans, borrowers, savers, businesses and financial markets, and explain what lies ahead for interest rates and the economy.