The Reserve Bank of India’s Monetary Policy Committee (MPC), meeting for the first time in the new financial year 2026–27, has voted unanimously to keep the policy repo rate unchanged at 5.25 per cent. This also means your home loan, car loan and personal loan EMIs will not change for now.
The standing deposit facility rate stays at 5 per cent and the marginal standing facility rate at 5.50 per cent, with the RBI maintaining a neutral stance to keep its options open.
“The RBI’s decision to hold the repo rate at 5.25%, while inflation remains close to the 5 per cent threshold, signals a cautious stance to balance growth and price stability,” said Raghvendra Nath, Managing Director of Ladderup Asset Managers.
The MPC met from April 6 to 8, 2026, chaired by RBI Governor Sanjay Malhotra, in the shadow of the ongoing Middle East conflict. The nation’s economic fundamentals remain strong, with real GDP growing at 7.6 per cent in 2025–26 on a new base year series. However, the rollover of the conflict is expected to slow things down in the year ahead, with GDP growth projected to slip to 6.9 per cent in fiscal 2026–27.
The Iran–US-Israel war has already reached India’s shores through energy prices and the crunch in LPG availability. Since March 2026, commercial LPG prices have been raised in two tranches, first by ₹115 per cylinder, then again by ₹195.50 per cylinder.
Despite state-run oil companies keeping base fuel prices the same, prices of some premium petrol variants have risen by about ₹2 per litre, and diesel for bulk/industrial buyers has risen by about 25 per cent. Domestic LPG prices remain unchanged so far, offering partial relief, but higher restaurant and delivery costs are already filtering through to everyday expenses for many.
“The country has been able to manage the crude oil supply situation for now, and headline inflation remaining below target provides enough headroom. However, energy price increases and weather disturbances have increased the upside risks to inflation projections,” said Lata Pillai, Senior Managing Director and Head - Capital Markets, India, JLL.
The RBI also projected CPI inflation at 4.6 per cent for FY 2026–27, peaking at 5.2 per cent in Q3 before easing. India’s foreign exchange seems to be staying strong at $697.1 billion as of April 3, 2026, which RBI expects to cover about 11 months of imports.
Following the RBI MPC announcement on Wednesday, the Sensex rose to more than 4 per cent to as high as 77,568.39 points.