Published on: August 6, 2025
RBI keeps repo rate unchanged at 6.5% in August 2025. Focus remains on taming inflation and sustaining growth. Know key highlights and market impact.
Key Highlights from the RBI August 2025 Monetary Policy
The Reserve Bank of India (RBI), in its Monetary Policy Committee (MPC) meeting held on August 6, 2025, decided to keep the repo rate unchanged at 6.5% for the fifth consecutive time. The central bank emphasized its commitment to managing inflation while supporting economic growth.
Repo Rate: No Change
- Current Repo Rate: 6.5%
- Standing Deposit Facility (SDF): 6.25%
- Marginal Standing Facility (MSF): 6.75%
- Bank Rate: 6.75%
Reason for Holding Rates
- Inflation is still above the RBI’s medium-term target of 4%.
- Monsoon-related uncertainties and global oil prices continue to pose risks.
- RBI wants to maintain stability while assessing inflation trends over the next few months.
Inflation and Economic Growth Outlook
Inflation Forecast:
- CPI inflation is expected to average 5.4% in Q2, declining gradually to 4.8% in Q4 FY25.
- Food inflation, especially in vegetables and cereals, remains volatile.
GDP Forecast:
- Real GDP growth for FY25 remains unchanged at 7.0%.
- Strong services sector and domestic demand are supporting growth
What RBI Governor Shaktikanta Das Said
“Our policy stance remains focused on the withdrawal of accommodation. The objective is to align inflation to the target while sustaining growth.”
Das reaffirmed the RBI’s commitment to anchoring inflation expectations and ensuring liquidity management remains smooth.
Impact on Markets & Borrowers
- Stock Market: Sensex and Nifty reacted positively to the status quo announcement.
- Loan Borrowers: Home loan and personal loan EMIs will remain the same.
- Banks & NBFCs: No immediate change in lending rates, but further liquidity measures may come.
What It Means for You
| Segment | Impact |
|---|---|
| Home Loans | No EMI hike, fixed benefits for now |
| FD Rates | Banks may hold or slightly tweak FD interest |
| Stock Market | Stability welcomed by investors |
| Businesses | Easier to plan with policy consistency |
Conclusion
The RBI’s August 2025 monetary policy signals a steady hand amidst uncertainty. With inflation being monitored closely and growth momentum intact, the central bank is treading cautiously. The coming months will be crucial in shaping the future policy moves.
