RBI Monetary Policy 2025 Highlights: The Reserve Bank of India (RBI) has announced its monetary policy decision today, Wednesday, 1 October 2025. The fourth bi-monthly meeting of the Monetary Policy Committee (MPC) for FY26, chaired by RBI Governor Sanjay Malhotra, was held from September 29 to October 1, and the repo rate decision was announced today.
The RBI MPC kept the repo rate unchanged at 5.50% and maintained the policy stance as ‘Neutral’. This marked the second consecutive pause following a cumulative 100 basis point (bps) rate cut earlier in the year.
All MPC members voted in favour of maintaining the repo rate unchanged and retaining the stance as “neutral.” The Standing Deposit Facility (SDF) rate remains at 5.25%, while the Marginal Standing Facility (MSF) rate continues at 5.75%.
The RBI raised FY26 GDP growth estimates to 6.8% from 6.5% earlier, and also reduced FY26 CPI inflation forecast to 2.6% from 3.1% earlier.
RBI Governor also proposed a slew of measures for banking sector to improve flow of credit into the system, reduce cost of infrastructure financing by NBFCs, measures for internationalising Indian Rupee, strengthen export sector, simplify foreign exchange management and enhance consumer satisfaction.
RBI Monetary Policy 2025 Highlights: Here are key takeaways from October RBI monetary policy today:
1] Policy Measures:
2] GDP Growth Estimates
RBI raises FY26 GDP growth estimates to 6.8% from 6.5% earlier. Here are the quarterly estimates:
3] CPI Inflation Forecast
RBI cuts FY26 CPI inflation forecast to 2.6% from 3.1% earlier. Here are the quarterly estimates:
4] Developmental and Regulatory Policies
5] Reforms to Improve Credit Flow
6] Promoting Ease of Doing Business
7] Internationalising Indian Rupee
8] Enhancing consumer satisfaction
9] The minutes of the MPC meeting will be published on October 15, 2025.
10] The next RBI MPC meeting is scheduled from December 3 to 5, 2025.
RBI Monetary Policy 2025 LIVE: The Indian stock market ended with strong gains on Wednesday, October 1, after the RBI policy announcement. The Sensex jumped 715.69 points, or 0.89%, to close at 80,983.31, while the Nifty 50 settled 225.20 points, or 0.92%, higher at 24,836.30. The Bank Nifty index surged 712.10 points, or 1.30%, to end the session at 55,347.95 after the RBI proposed several measures for the banking sector.
RBI Monetary Policy 2025 LIVE: The MPC’s decision to hold the repo rate reflects a measured wait-and-watch approach. Existing and new loan borrowers will continue to benefit from sustained favorable interest rates. Lenders are likely to keep the rates mellowed, supporting lower EMI burden and increased housing demand. At the same time, lower construction costs under GST 2.0 could further soften property prices, creating meaningful savings for buyers. As capital flows back into real estate, allied sectors such as construction and infrastructure will gain momentum, creating jobs and boosting demand for affordable housing. Together, these factors can provide a strong lift to overall GDP growth, said Atul Monga, CEO & Co-Founder, BASIC Home Loan.
RBI Monetary Policy 2025 LIVE: The RBI’s MPC has delivered a dovish pause today, balancing confidence over improving inflation dynamics with a prudent acknowledgment of persistent global risks and recent domestic reforms. The policy stance remains flexible, we expect a 25-basis point cut in December 2025, with potential for additional easing if growth surprises negatively. The 10-year yield should trade between 6.40-6.60% over the coming quarter, and for the USD/INR to trade with a modest depreciation bias, with the RBI poised to act against undue currency swings. For now, the message from MPC is clear: pause, consolidate, and ensure transmission — while keeping all options open amid an evolving global and domestic backdrop, said Dhiraj Relli, MD & CEO, HDFC Securities.
RBI Monetary Policy 2025 LIVE: The minutes of the RBI MPC’s October meeting will be published on October 15, 2025. The next meeting of the MPC is scheduled for December 3 to 5, 2025.
RBI Monetary Policy 2025 LIVE: RBI has allowed its front-loaded June Policy rate-cut to play out into the banking system, even as trade related uncertainties are unfolding. We feel the dovish tone of October policy, however, now creates favorable ground for short-term and long-term yields. Liquidity will continue to remain easy, aided by planned CRR cuts. RBI assured keeping banking system liquidity in sufficiently positive zone to enable policy cut transmissions. RBI will continue to conduct Liquidity operations in a way that will keep overnight rate closer to the policy rate, said Amit Somani, Deputy Head - Fixed Income, Tata Asset Management.
With inflation firmly under control now and having benign outlook on account of fiscal policy measures undertaken, we feel it is time for the Monetary policy to begin with another set of easing measures to support growth in current uncertain global environment. We expect 10-yr G-sec to trade in 6.40% - 6.60% range. Short-term yields are likely to remain range bound with 1-year CDs trading in 6.25%-6.50% range, he added.
RBI Monetary Policy 2025 LIVE: While the RBI policy statement provides a dovish tone and has opened up a realistic chance for the next cut in December, the bar for rate cuts still remains high if one looks at the forward guidance on inflation and may not get delivered unless growth staggers significantly. This policy is also quite heavy in regulatory announcements that seek to enhance flow of credit and improve competitiveness of banks, scope for acquisition funding and infrastructure funding was enhanced and boundaries of the NBFC and banks was reduced, all of which is expected to boost growth, said Indranil Pan, Chief Economist at YES Bank.
RBI Monetary Policy 2025 LIVE: The RBI’s decision of status quo doesn’t come as a surprise. However, lower borrowing costs would have positively influenced affordability and purchasing decisions, particularly in the budget and mid-income segments. For luxury real estate, interest rates aren’t the main trigger and its direct impact on the segment is limited. Over the past few years, there has been a quiet transformation in the way people approach homeownership, especially at the premium end of the market. In a market like Goa, demand from NRIs, HNIs, and serious investors is unlikely to slow, said Lincoln Bennet Rodrigues, Chairman and Founder, Bennet & Bernard.
RBI Monetary Policy 2025 LIVE: The further sharp moderation in the inflation trajectory has opened the door for a rate cut, possibly the last one in this cycle. However, the currently resilient domestic economy gives the RBI time to assess the full impact of US tariff policies and the GST rate cut. This dovish tilt will further boost expectations of a rate cut in the next monetary policy meeting and should help improve market sentiment. Currently elevated market yields, combined with low running inflation, offer a favourable risk-reward profile for investors.” Vikas Garg, Head - Fixed Income, Invesco Mutual Fund.
RBI Monetary Policy 2025 LIVE: The RBI delivered the best hope for the bond market today. RBI acknowledged the considerable change of inflation expectations and emerging policy space to cut further. We believe RBI can cut policy rates by 25-50 bps in the upcoming policies depending on growth inflation dynamics. Given the easy liquidity and possibility of further rate cuts, we believe the short to medium end of the yield curve remains best placed, said Anurag Mittal, Head of Fixed Income at UTI AMC.
RBI Monetary Policy 2025 LIVE: The additional measures announced by the RBI to stimulate growth by lowering infrastructure financing costs, improving credit flow, and promoting ease of doing business are commendable. Enhancing lending against shares and IPO financing are likely to maintain growth momentum in the capital market and fund flow to the industry. Homebuyers are expected to remain cautiously optimistic, with strong sentiment for end-use and second homes driven by ongoing infrastructure projects, wealth creation, reduced home loan interest rates, price stabilization, and other government initiatives, said Amit Bhagat, Co-Founder, CEO and MD, ASK Property Fund.
RBI Monetary Policy 2025 LIVE: Framework to allow Indian banks to finance acquisitions by domestic corporates, this is big as globally acquisition financing is a large segment of bond issuance. Making this level playing field for domestic banks with foreign investors will help expand capital markets, said Vishal Goenka, Co-Founder of IndiaBonds.com.
On removal of the regulatory ceiling on lending against listed debt securities, Goenka said that the financing will flow to listed bonds, expanding investment and liquidity in corporate bonds.
Reduction of risk weightage for NBFCs for infrastructure lending will spur better flow of credit financing through capital markets with bonds being the likely choice, he added.
RBI Monetary Policy 2025 LIVE: The rupee recovered 15 paise from its all-time low to 88.65 against the US dollar on Wednesday, after the RBI Governor delivered a dovish pause. At the interbank foreign exchange, the rupee opened at 88.79 against the US dollar, then rose to 88.65, higher by 15 paise from its previous close. On Tuesday, the rupee fell 5 paise to an all-time low of 88.80 against the US dollar.
RBI Monetary Policy 2025 LIVE: We do not comment on individual entities, RBI Governor said on Tata Sons listing issue.
RBI Monetary Policy 2025 LIVE: RBI does not target any specific level for the rupee. Instead, the priority is to manage volatility in the currency, said RBI Governor Malhotra.
RBI Monetary Policy 2025 LIVE: RBI is reviewing a set of currencies to establish reference rates, beginning with the Indonesian Rupiah and the UAE Dirham (AED), said RBI Governor Sanjay Malhotra.
RBI Monetary Policy 2025 LIVE: Banking measures should not be seen as taking away from financial stability. Financial and price stability is foremost for us. The measures should not be seen as relaxation or letting go of our oversight from financial stability. We do not want to micromanage and believe banks will take a conscious, considered and balanced view, said RBI Governor.
RBI Monetary Policy 2025 LIVE: Limits on loans against shares were last revised in 1998. Hence, it has to be revised now, said RBI Deputy Governor.
RBI Monetary Policy 2025 LIVE: There are currently no proposals to levy charges on UPI transactions. The central bank has not considered introducing any fees for transactions on the UPI platform, informed RBI Governor Sanjay Malhotra.
RBI Monetary Policy 2025 LIVE: Banking system’s ability to handle risks has improved over a period, said RBI Deputy Governor M. Rajeshwar Rao
RBI Monetary Policy 2025 LIVE: We have taken balanced, calibrated and well thought-out measures for the banking sector. Aim will be to promote stability of the system while enhancing growth of the economy. We will invite public consultation on all measures, said RBI Governor.
RBI Monetary Policy 2025 LIVE: GST cut will not fully offset impact of US tariffs, said RBI Governor.
RBI Monetary Policy 2025 LIVE: There has been a transmission of 30 basis points in government bond yields, reflecting changes in market expectations and monetary conditions, said RBI Governor Sanjay Malhotra.
RBI Monetary Policy 2025 LIVE: The Inflation-growth dynamics has changed and hence the policy language has changed. We are hopeful that we will continue to maintain a high growth trajectory, said the RBI Governor.
RBI Monetary Policy 2025 LIVE: Impact of global headwinds limited on Indian economy as ours is demand-driven economy. RBI, the government will make all efforts to counter all global headwinds, said RBI Governor.
RBI Monetary Policy 2025 LIVE: Inflation has reduced considerably since June. That opens space for growth. Growth delivered an upside surprise this quarter, but there is a downward revision in the coming quarters due to the impact of higher US tariffs, some offset by GST rate cut. Impact of GST rate cut, other policies unfolding. Hence, MPC felt to pause rates, said RBI Governor Sanjay Malhotra.
RBI Monetary Policy 2025 LIVE: RBI Governor Sanjay Malhotra begins post-policy press conference
The RBI’s decision to keep the repo rate unchanged was in line with our expectations. The pause in the current meeting leaves room for the RBI to opt for a 25 bps rate cut in the forthcoming meetings, with growth buoyancy continuing and expectations of softening inflationary pressures, said Naveen Kulkarni, Chief Investment Officer, Axis Securities PMS.
For banks, Q2 is expected to be another soft quarter, with tepid growth, NIM pressures, weaker treasury performance sequentially and higher credit costs. Banks are yet to see a meaningful recovery in credit growth, which is expected from H2 onwards. We expect NIMs to bottom out in Q2, so far. H2 margins should find support from deposit repricing and the CRR cut. Banks are seeing green shoots in terms of asset quality metrics and expect better outcomes from H2 onwards. We believe valuations for most banks are comfortable and clarity on pick-up in growth and improving asset quality metrics would warrant upside in banking stocks. We currently prefer HDFC Bank, Kotak Mahindra Bank, SBI and Federal Bank, he added.
RBI Monetary Policy 2025 LIVE: A very prudent policy in the uncertain global scenario. The slew of measures announced by RBI of giving more power to Bank Boards, bringing global best practices through ECL and Basel 3 norms, differential premium on deposits, removing large framework restriction in an era of growing companies and economy including acquisition financing, giving more leg room to exporters and enabling individuals to leverage their equity assets augurs well for the economy, said Pralay Mondal, MD and CEO, CSB Bank.
RBI Monetary Policy 2025 LIVE: A more balanced forward guidance that acknowledges downside risks to growth, along with a downward revision in future CPI projections, has clearly opened up additional policy space. Furthermore, regulatory measures aimed at enhancing the flow of bank credit to various segments of the economy have been announced. However, the absence of specific steps to improve the transmission of policy easing into markets and the broader economy remains a dampener, said Rajeev Radhakrishnan, CFA, CIO - Fixed Income, SBI Mutual Fund.
RBI Monetary Policy 2025 LIVE: Bank Nifty jumps after RBI proposes slew of measures for banking sector. Kotak Mahindra Bank, ICICI Bank, Axis Bank, and HDFC Bank were the top gainers in the index.
RBI Monetary Policy 2025 LIVE: “The MPC delivered exactly a “dovish pause” which the market expected. But despite the policy being in tune with market expectations, the market has given a thumbs up to the policy since the Central bank delivered some unexpected pro-market initiatives like allowing banks to fund acquisitions and also further liberalising loans against shares. The Governor’s comments indicate the possibility of one more rate cut; but it will depend on the incoming data and evolving outlook, said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Investments.
RBI Monetary Policy 2025 LIVE: RBI MPC unanimously voted to keep the policy repo rate unchanged at 5.5%. The MPC also decided to retain the stance at neutral. However, two members - Dr. Nagesh Kumar and Prof. Ram Singh, were of the view that the stance be changed from neutral to accommodative.
RBI Monetary Policy 2025 LIVE: RBI Governor stated three consumer centric proposals:
RBI Monetary Policy 2025 LIVE: RBI proposes three measures for internationalising Indian Rupee
RBI Monetary Policy 2025 LIVE: Key provisions relating to eligible borrowers, recognised lenders, limits on borrowing, cost of borrowing, end-use and reporting, etc. in ECB regulations, issued under FEMA, are proposed to be rationalised, said RBI Governor. He also proposed to rationalise FEMA regulations regarding nonresidents establishing their business presence in India.
RBI Monetary Policy 2025 LIVE: To further strengthen the export sector and enhance ease of doing business, RBI proposed to extend the time period for repatriation from foreign currency accounts of Indian exporters in IFSC, from one month to three months, increase the period for forex outlay for Merchanting Trade transactions, from four months to six months; and simplify the process of reconciliation of outstanding entries related to exports and imports in the respective reporting portals (EDPMS/IDPMS).
RBI Monetary Policy 2025 LIVE: To reduce the cost of infrastructure financing by NBFCs, RBI proposed to reduce the risk weights applicable to lending by NBFCs to operational, high quality infrastructure projects.
RBI Monetary Policy 2025 LIVE: RBI proposed to withdraw the framework introduced in 2016 that disincentivized lending by banks to specified borrowers (with credit limit from banking system of ₹10,000 crore and above).
“While the Large Exposure Framework since put in place for banks addresses credit concentration risk to a particular entity or group at an individual bank-level, concentration risk at the banking system level, as and when considered necessary, will be managed through specific macroprudential tools,” RBI Governor said.
RBI Monetary Policy 2025 LIVE: RBI proposes to remove the regulatory ceiling on lending against listed debt securities and enhance limits for lending by banks against shares from ₹20 lakh to ₹1 crore and for IPO financing from ₹10 lakh to ₹25 lakh per person.
RBI Monetary Policy 2025 LIVE: RBI Governor announced five measures to improve flow of credit. Firstly, it proposed to expand the scope of capital market lending by banks, by enabling a framework for Indian banks to finance acquisitions by Indian corporates.
RBI Monetary Policy 2025 LIVE: RBI proposed to make the revised Basel III capital adequacy norms effective for commercial banks (excluding SFBs, PBs and RRBs) from 1st April 2027. In furtherance of this, a draft of the Standardised Approach for Credit Risk shall be issued shortly. Under the revised approach, the proposed lower risk weights on certain segments are expected to reduce the overall capital requirements, particularly for MSMEs and residential real estate (including home loans).
RBI Monetary Policy 2025 LIVE: The Indian stock market benchmark indices jumped after the RBI Governor Sanjay Malhotra announced the October monetary policy and revealed big measures for Indian banks. The Sensex traded over 250 points higher, Nifty 50 was above 24,650 and the Bank Nifty index gained over half a percent.
RBI Monetary Policy 2025 LIVE: The Expected Credit Loss (ECL) framework is proposed to apply to banks and financial institutions from April 1, 2027, with a five-year glidepath for implementation, said RBI Governor. Revised Basel III norms will also take effect from April 1, 2027.
RBI Monetary Policy 2025 LIVE: RBI proposes regulatory changes in lending against securities. The central bank proposed removal of the ceiling on lending against listed debt securities, increase in limits for lending against shares from ₹20 lakh to ₹1 crore per person, and enhancement of IPO financing limits from ₹10 lakh to ₹25 lakh per person.
RBI Monetary Policy 2025 LIVE: Banks in Bhutan, Nepal, and Sri Lanka will now be allowed to lend in Indian rupees to Non-Resident Indians (NRIs), said RBI Governor.
RBI Monetary Policy 2025 LIVE: RBI Governor proposed reforms in insurance premiums and lending limits. The central bank proposed the introduction of risk-based deposit insurance premiums to lower costs for higher-rated banks.
RBI proposes measures to improve credit flow to the real economy. Governor Sanjay Malhotra proposes enabling framework for Indian banks to finance acquisitions by Indian corporations, and remove the regulatory ceiling on lending against listed debt securities to enhance lending flexibility, RBI also plans to publish a discussion paper on licensing new urban cooperative banks (UCBs).
RBI Monetary Policy 2025 LIVE: Total of 100 bps rate cut have led to 58 bps reduction in fresh loans, says RBI Governor Sanjay Malhotra.
RBI Monetary Policy 2025 LIVE: RBI now holds a record 880 metric tonnes of gold, valued at over ₹4.32 lakh crore ($71 billion), informs RBI Governor.
