RBI to Keep Interest Rates Unchanged Through 2026 Amid Growth Concerns
The Reserve Bank of India is expected to maintain its key interest rate at 5.25% through the end of 2026, according to a Reuters poll of economists. This decision reflects concerns over economic growth risks posed by global events such as the Middle East war and U.S. tariffs, which are affecting vulnerable sectors in India. Inflation rose slightly above RBI's target but is not expected to prompt rate hikes unless it becomes more persistent. Economists believe that raising rates now would harm growth at a time when economic expansion is slowing from 7.7% last year to an estimated 6.6%. The central bank has also taken measures to support the weakening rupee, but these have not fully stemmed its decline against the dollar this year. The RBI's cautious stance contrasts with some global central banks that are raising rates aggressively to combat inflation and currency depreciation.
Topics: economic growth inflation interest rates RBI policy outlook