The Reserve Bank of India (RBI) said it will keep the repo rate at 5.5%. This was the decision from the October 2025 money policy meeting. This is now the second time in a row that they have kept the rate steady. The bank wants to help the economy grow. They also want to stop prices from going up too fast.
The Monetary Policy Committee (MPC) all agreed to keep the rate the same. It also chose not to take sides or show a strong view one way or the other. This shows that there is trust in how strong India’s economy is, even when the world is facing many unknowns.
Why the Repo Rate Remains Unchanged
The repo rate is the rate that the RBI uses to lend money to other banks. The central bank sets this at 5.5%. It wants to keep prices under control by doing this. The bank also hopes this move will help the country to grow.
If you have taken a loan, your EMIs for home, car, or other loans will not go up or down quickly. Interest rates will stay as they are right now. This helps people feel good about buying homes and how they spend their money. It is also good for businesses. The cost to borrow money will stay steady, which lets them plan for investments without too much concern.
RBI Governor Sanjay Malhotra said the main reason for this choice is to give time for past rate cuts to show all their results. He also said he will wait and see what is happening in the world before making any new moves.
Growth Outlook Revised Upward
The RBI has some good news for all of us in the country. The bank now says that India’s GDP will go up by 6.8% in the year 2025-26. This is higher than what was told before. Earlier, they said the estimate was 6.5%.
The central bank says that strong demand, big private investments, and people spending more money will help the country grow. A good monsoon will help, too. Money from the government for new buildings and updates in GST will also be good for the economy.
The MPC says the Indian economy is still on track. Both the making of goods and services are doing well right now.
Inflation Outlook Improves
The RBI has also cut its inflation plan for the year 2025-26. Now, it is at 2.6%. Before this, the rate was 3.1%.
Food and fuel prices have gone down. A good harvest season has helped with this. The global markets have also been steady. Right now, the inflation level is within the RBI’s target of 2% to 6%. So, there could be some changes in policy in the next few months.
A low inflation rate is good for people. Prices stay about the same and you know what will happen. Businesses like this too. They know what their costs will be. This helps us feel safe about money.
Global Risks and Domestic Confidence
The RBI is hopeful about the future. But it stays careful because there can be problems in the world. Countries sometimes fight. Oil prices go up or down. Trade between countries can be slow. These things can make it hard for the economy.
Even with these risks, the RBI says that India has a strong base at home. The government is careful with its money. A steady money system will help too. Because of all this, the economy will grow.
The neutral stance means that the RBI can change its policy if outside problems come up. It also helps the RBI act fast if prices start to go up again.
Impact on Households and Businesses
When the repo rate does not change in India, EMIs stay the same. People feel steady about their money because of this. It helps them plan what they want to buy. They can know how much they will pay each time and feel good about their choices.
For businesses, MSMEs, and real estate builders, keeping borrowing costs steady is good. It helps them know what to expect in the future. This makes it easier to plan and grow.
Conclusion
The October 2025 policy shows that the RBI wants the country to keep growing well and not let prices go up too fast. The central bank has kept the repo rate at 5.5%. It also says that the country’s GDP could grow by 6.8%. This means they want to help the economy get better, but they also want prices to stay steady.
Prices are not going up fast right now. Growth is getting better. It seems that India will keep going forward with its economic development in this year.