RBI Holds Rates Steady, Boosts Growth Projections

RBI Governor Sanjay Malhotra announced key points of the bi-monthly monetary policy. Benchmark lending rates remain unchanged at 5.25%, with a neutral stance. GDP growth projections increased, and various measures to support consumption and exports were introduced, including improved loan limits for MSMEs and safeguards for senior citizens against digital fraud.

In a pivotal announcement, Reserve Bank of India Governor Sanjay Malhotra revealed that the central bank maintained benchmark lending rates at 5.25% amid a neutral monetary policy stance. The decision comes in light of GST reforms and monetary easing expected to invigorate private consumption.

The RBI has adjusted GDP growth projections upwards for the initial quarters of FY27 to 6.9% and 7% respectively, citing supportive measures from the Union Budget. Retail inflation for the current fiscal is projected at an encouraging 2.1%, while consumer price inflation is anticipated to be 4% and 4.2% in the first two quarters of FY27.

Amid efforts to bolster the economy, the RBI unveiled plans to double the collateral-free loan limit for MSMEs to Rs 20 lakh. Furthermore, upcoming frameworks aim to protect senior citizens from digital fraud, and banks will soon be permitted to lend to REITs. The policy updates highlight a concerted effort to support growth and safeguard citizens in an evolving economic landscape.

(With inputs from agencies.)