RBI raises policy repo rate by 25 basis points to 5.50% amid global uncertainty

The Reserve Bank of India has increased the policy repo rate by 25 basis points to 5.50%, marking its first rate hike since February 2023. The move comes amid economic uncertainties spanning both domestic and international markets.

Geopolitical developments in West Asia have introduced instability in global markets, impacting economic activity worldwide. However, RBI Governor Sanjay Malhotra noted that despite these headwinds, the Indian economy continues to demonstrate strength with broad-based momentum across sectors.

The rate decision reflects the central bank's balancing act between managing inflation pressures and supporting growth as global conditions remain uncertain.