The RBI’s three-day monetary policy meeting begins today, with the policy outcome on Friday

The three-day meeting of the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) begins in Mumbai on Wednesday.

Members of the MPC will hold detailed discussions on the future stance of monetary policy, taking into account the latest data on GDP growth and inflation. The policy outcome will be announced by RBI Governor Sanjay Malhotra at 10 am on Friday.

The meeting comes at a time when India’s economic performance remains strong and inflation has fallen sharply. The GDP figures stood at 8.2 percent for the July-September period, the second quarter of the current financial year 2025-2026.

At the same time, inflation has reached record lows. India’s retail inflation has fallen sharply to 0.25 percent by October 2025, according to the Ministry of Statistics and Program Implementation (MoSPI).

According to a Bank of Baroda report, the central bank is expected to keep the repo rate unchanged in this policy.
The report said, “We expect the RBI to keep the repo rate steady at 5.50 percent in Dec-25. The stance is also expected to remain neutral.”

The report highlighted that India’s economic growth remains robust, with GDP growth of 8.2 percent in the second quarter of FY26 exceeding market expectations. On inflation, the report noted that price pressures have eased significantly as CPI inflation fell to a record low in October 2025, mainly due to a sustained decline in food prices. It added that inflation is expected to moderate further and could even fall below the RBI’s own estimates.

Despite opening up room for a possible rate cut, the report says the RBI is likely to remain cautious in the upcoming policy review, especially as economic growth remains strong.

Sharing his view on the current situation, Mehul Pandya, MD and Group CEO, CareEdge Ratings, told ANI that both strong GDP growth and multi-year low inflation are creating contradictory signals for interest rate decisions.

He said: “Both developments (of continued strong GDP growth and multi-year low inflation levels) are opposing forces from an interest rate perspective. Central banks are generally reluctant to cut interest rates during periods of strong economic activity, represented by GDP growth. At the same time, central banks usually respond to a low inflation environment by cutting interest rates.”

The MPC meeting is scheduled from December 3 to 5 and the final policy decision will be announced by RBI Governor Sanjay Malhotra on December 5 at 10 am.

(This story has not been edited by DNA staff and is published by ANI)