Published: 8 February 2026Business StandardEconomy
RBI MPC Unanimously Holds Repo Rate at 5.25%; Maintains Neutral Stance After 125 bps Cumulative Cuts
AQuick answer
RBI unanimously holds repo rate at 5.25%; neutral stance maintained; latest FY26 real GDP estimate at 7.6%, CPI inflation at 2.1%.
Key facts
RBI MPC unanimously decided to keep policy repo rate unchanged at 5.25% in its meeting held February 4-6, 2026
Standing Deposit Facility rate maintained at 5.00%; Marginal Standing Facility and Bank Rate at 5.50%
MPC maintained neutral stance, signalling easing cycle has done its job after cumulative rate cuts of 125 basis points over FY25-26 (from 6.50% in early 2025)
India's real GDP growth for FY26 estimated at 7.4% per First Advance Estimates; CPI inflation for FY26 projected at 2.1%, well below 4% target
Governor Sanjay Malhotra indicated focus on stability and monetary transmission
The Reserve Bank of India's Monetary Policy Committee (MPC), in its meeting held February 4-6, 2026, unanimously decided to keep the policy repo rate unchanged at 5.25%. The Standing Deposit Facility rate was maintained at 5.00%, and the Marginal Standing Facility and Bank Rate at 5.50%.
The MPC maintained its 'neutral' stance, signalling that the easing cycle has done its job after cumulative rate cuts of 125 basis points over FY25-26 (from 6.50% in early 2025). India's real GDP growth for FY26 was estimated at 7.4% per First Advance Estimates. CPI inflation for FY26 was projected at 2.1%, well below the 4% target. Governor Sanjay Malhotra indicated focus on stability and monetary transmission.
PYQPrelims/PYQ angle
RAS 2023 RBI inflation targeting framework — Both examine the RBI's inflation-targeting framework, with this decision illustrating MPC behaviour when CPI prints well below the 4% target.
Mains angle
Q: Evaluate the RBI MPC's February 2026 decision to hold the repo rate at 5.25% after a 125 bps cumulative easing cycle.
Answer (50 words):
The RBI's Monetary Policy Committee unanimously kept the repo rate unchanged at 5.25% in its 4-6 February 2026 meeting, with SDF at 5.00% and MSF at 5.50%. The neutral stance continues after 125 bps cumulative cuts over FY25-26. Governor Sanjay Malhotra cited 7.4% GDP growth and 2.1% CPI inflation projections.
What was the RBI MPC decision on repo rate in February 2026?
The **RBI Monetary Policy Committee (MPC)**, in its meeting held **February 4-6, 2026**, unanimously decided to **keep the policy repo rate unchanged at 5.25%**. The SDF was maintained at **5.00%**, and MSF/Bank Rate at **5.50%**.
What monetary policy stance did RBI maintain in February 2026?
The RBI MPC maintained its **'neutral' stance**, signalling that the **easing cycle has done its job** after cumulative rate cuts of **125 bps**. The neutral stance provides flexibility to respond to evolving economic conditions.
How much has RBI cut rates cumulatively before the February 2026 pause?
The RBI had cumulatively cut the repo rate by **125 basis points (bps)** before pausing at 5.25% in February 2026. This brought the repo rate down from 6.50% (the peak) to 5.25%.
What are the current policy rates set by RBI in February 2026?
RBI policy rates as of February 2026: **Repo Rate 5.25%**; **Standing Deposit Facility (SDF) 5.00%**; **Marginal Standing Facility (MSF) 5.50%**; **Bank Rate 5.50%**. The corridor between SDF and MSF is 50 bps.
What is the significance of RBI maintaining neutral stance in 2026?
The **neutral stance** signals that RBI is **neither committed to more rate cuts nor to rate hikes** — it will be data-dependent. Given India's 6.4% FY27 growth projection and inflation at 3.21% (within the 2-6% band), the neutral stance provides flexibility for future adjustments.
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