RBI Monetary Policy Update - April 2025

RBI Monetary Policy Update - April 2025

The Monetary Policy Committee (MPC) came out with its first bi-monthly policy statement for FY26 on April 09, 2025. Some of the key announcements are as follows:

• The MPC unanimously decided to lower the policy Repo Rate by 25bps to 6.00 per cent and change the stance to 'accommodative'. Consequently, the SDF rate stands at 5.75 per cent and the MSF rate at 6.25 per cent
• The accommodative stance implies that the ensuing MPC outcomes would either be a status-quo or a cut when in its future course of action. This is a dovish shift in terms of policy guidance
• Governor explicitly stated that the stance provides policy rate guidance, without any direct guidance on liquidity management
• On Liquidity, the Governor emphasised that the MPC will 'proactively' take liquidity measures to keep liquidity adequate; At the presser he did indicate that a surplus to the tune of around 1 per cent of NDTL was considered as a reasonable assessment. He also stated that the deliberations are ongoing with regard to the liquidity management framework
• The outlook for food inflation has turned decisively positive on robust agriculture output. Additionally, a normal monsoon and softer commodity prices has resulted in lowering inflation outlook by 20bps to 4.0 per cent in FY26
• On Growth amid challenging global economic conditions, the benign inflation outlook and moderate growth demand that the MPC continues to support growth