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Informist, Wednesday, Aug. 6, 2025

 

MUMBAI - Arsh Mogre, economist, Prabhudas Liladhar Capital, said the following on the Reserve Bank of India's third bi-monthly monetary policy for 2025-26 (Apr-Mar) detailed on Wednesday:

 

"RBI's decision to hold the repo rate at 5.50% was not merely an exercise in prudence but it was a calibrated pause at the intersection of global fragility and domestic resilience. While headline inflation remains benign and June's front-loaded 50 bps cut still transmits through the system, the MPC appears acutely aware that downside risks to growth from tariff spillovers are not yet fully priced in. Maintaining a 'neutral' stance signals optionality rather than indecision as the central bank is keeping policy nimble in case trade shocks escalate or if financial conditions tighten globally. Any fresh easing will now hinge not just on data but on the balance of risks between global trade retrenchment, domestic demand softening and the rupee's trajectory. In this context, today's decision preserves both credibility and flexibility while acknowledging that we are in an uncertain world where macro policy must avoid both premature celebration and pre-emptive exhaustion."  End

 

Compiled by Janwee Prajapati
Filed by Akul Nishant Akhoury

 

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