New Delhi, August 5: The Reserve Bank of India has maintained its key policy interest rates, keeping the repo rate anchored at 5.25 per cent to balance growth while monitoring price stability. Presenting the policy outlook, RBI Governor Sanjay Malhotra declared that while broad-based inflationary pressures stay moderate, second-round effects from elevated fuel and food expenses continue to pose risks to headline figures. The revised quarterly CPI projections are set at 5.3 per cent for Q1, 4.7 per cent for Q2, 5.9 per cent for Q3, and 5.5 per cent for Q4, with the overall core inflation expected to average around 4.3 per cent for the fiscal year.
Analyzing sectoral indicators, the central bank affirmed that while agricultural output faces risks from uneven rainfall, robust reservoir levels and government measures like crop diversification should cushion the impact. “Going ahead, the usual return of currency during the monsoon season, drawdown of government cash balances, and our special measures to attract capital inflows are expected to aid banking system liquidity in the near term,” Governor Malhotra declared. The Governor added that short-term money market rates moderated during July, while noting that global supply chain shifts and easing West Asia tensions continue to influence broader macroeconomic stability.
