“The RBI’s decision to keep the repo rate unchanged at 5.25% reflects a balanced and ‘safety-first’ approach, prioritising macroeconomic stability. While the Indian economy continues to demonstrate strong growth at 7.6%, a cautious stance is warranted amid evolving global uncertainties, particularly geopolitical tensions in West Asia and volatility in crude oil prices.
By maintaining the rates steady, the RBI is reinforcing the sustainability of the ongoing recovery while ensuring predictability in borrowing costs which is a welcome relief for both households as well as businesses.
We also respect the RBI’s continued focus on improving ease of doing business, especially for MSMEs. The removal of due diligence requirements for onboarding onto the TReDS platform is a progressive step that will significantly enhance liquidity access and working capital efficiency for small businesses. Further, measures aimed at simplifying banks’ capital management frameworks and broadening participation in the term money market will deepen financial markets, enhance systemic efficiency, and strengthen overall financial stability.”