RBI has kept the rates unchanged in tune with the Market sentiments.

 Figures indicate economy is resilient, but fact remains that challenges to the economy from Politics, economics, social and technology ( PEST) angle  remain as defiant as ever. Added to these, the projected possible failure of the monsoon and geo political uncertainties also remain as challenges to keep the inflation and inflationary expectations under control. The Cost of production which is dependent upon monetary , fiscal and administrative policies also remains high as it is , without leaving any scope for reduction in the near future. Imported inflation always remains a challenge and maintaining price stability and economic growth through monetary policy alone is not sustainable is the reality. In these circumstances, the Present Monetary policy keeping the Policy Rates unchanged and maintaining RBI's stance Neutral itself can be considered as the most accommodative policy and the MPC has done an excellent job. The need to balancing the market sentiments has also been well factored into the policy announcement. 

T V G Krishnan

(this comment appeared in Money Life in response to the Article RBI Keeps Repo Rates unchanged Aug7,2026.)

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