RBI MPC retains repo coverage fee unchanged at 5.5% in August meet

In an unanimous resolution the Reserve Bank of India (RBI) Monetary Policy Committee (MPC) has stored the repo fee unchanged at 5.5% in its August coverage assembly.

The resolution was introduced by RBI Governor Sanjay Malhotra on Wednesday (August 6, 2025). The Monetary Policy Committee (MPC), which met on the 4th, fifth, and sixth of August, fastidiously reviewed the most recent financial and monetary circumstances earlier than taking this resolution.

Also Read: Monetary Policy Committee assembly LIVE: RBI retains repo fee unchanged at 5.5%

The Governor stated that each one six members of the MPC voted unanimously to take care of the repo fee below the Liquidity Adjustment Facility at 5.5%.

The RBI Governor acknowledged, “After an in depth evaluation of the evolving macroeconomic and monetary developments and outlook, the MPC voted unanimously to maintain the coverage file below the Liquidity Adjustment Facility unchanged at 5.5%.This comes after the MPC had decreased the repo fee by 50 foundation factors to five.5% within the earlier coverage assembly held in June.

The purpose for the sooner fee lower was the easing of inflation. Earlier he acknowledged that each near-term and medium-term inflation ranges are actually throughout the RBI’s consolation zone. He additionally highlighted that meals inflation has remained mushy, which provides the central financial institution extra flexibility in its selections.

Retail inflation in India has continued to fall and has now reached its lowest stage in additional than six years. According to the Ministry of Statistics, the year-on-year inflation fee based mostly on the Consumer Price Index (CPI) for June was 2.10% (provisional), a drop of 72 foundation factors in comparison with May 2025. This is the bottom CPI inflation fee since January 2019.Food costs have additionally dropped.

The Consumer Food Price Index (CFPI) for June confirmed a year-on-year inflation fee of (-) 1.06% (Provisional). In rural areas, the meals inflation fee was (-) 0.92%, whereas in city areas, it was (-) 1.22%.

Wholesale inflation has additionally turned damaging. The Wholesale Price Index (WPI) for June stood at (-) 0.13%, in comparison with 0.39% in May. The Ministry of Commerce and Industry stated the damaging WPI was on account of decrease costs of meals gadgets, mineral oils, primary metals, crude petroleum, and pure gasoline.

Governor Malhotra added that the financial outlook seems optimistic. “The monsoon season is progressing properly, and the upcoming pageant season normally will increase financial exercise. Combined with supportive authorities and RBI insurance policies, this example bodes properly for the Indian financial system within the close to time period,” he stated.