The Reserve Bank of India's Monetary Policy Committee voted unanimously to keep the benchmark repo rate unchanged at 5.75 per cent, maintaining the accommodative stance that has characterised policy since the 50-basis-point cut delivered in the previous cycle.

Governor Sanjay Malhotra, presenting the committee's decision, noted that while retail inflation had declined to 4.8 per cent in June — within the RBI's 2-6 per cent target band — global financial market volatility and uncertain monsoon distribution patterns warranted a watchful pause.

The governor signalled that the MPC retains capacity for "one further calibrated adjustment" in the second half of FY27 should inflation trajectory remain benign and growth show signs of broadening beyond the export and services sectors. This language was interpreted by bond markets as ruling out multiple additional cuts and prompted a modest rise in benchmark yields.

GDP growth projections for FY27 were retained at 7.2 per cent. The committee acknowledged that private consumption recovery remains uneven, with rural demand strengthening but urban discretionary spending still below pre-pandemic trends in several categories.