RBI Expected to Maintain Rates Amid Rising Inflation and Growth Concerns
RBI likely to hold rates as war-driven risks cloud inflation and growth outlook
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The Reserve Bank of India (RBI) is anticipated to hold interest rates steady during its upcoming policy meeting on April 8, 2025, due to inflation risks and a weakening growth outlook influenced by the ongoing conflict in West Asia. Economists predict cautious signals regarding GDP growth and inflation forecasts.
- 01RBI likely to pause rate changes amid inflation and growth concerns.
- 02Inflation projected to rise to 4.7%, impacting consumer prices.
- 03GDP growth forecast revised down from 7% to 6.5% for FY27.
- 04Rupee management measures taken, but no new policy actions expected.
- 05Market participants are closely monitoring RBI's economic projections.
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As the Reserve Bank of India (RBI) approaches its policy decision on April 8, 2025, a pause in interest rates is widely anticipated due to rising inflation risks and a weakening economic growth outlook, exacerbated by the ongoing conflict in West Asia. A recent poll indicates that all participating economists expect the Monetary Policy Committee (MPC) to maintain the repo rate at 5.25%, the level reached after a cumulative cut of 125 basis points in 2025. The RBI's previous projections for GDP growth in the April-June quarter were at 6.9%, but this is now expected to be revised down to 6.5%. Inflation, which rose to 3.21% in February from 2.75% in January, is projected to reach 4.7% due to disruptions in the global oil market, with Brent crude prices surging to over $100 per barrel. Despite the rupee hitting an all-time low of 95.1250 per dollar, experts believe the RBI will continue using regulatory measures rather than rate hikes to manage currency volatility. The upcoming policy is expected to focus more on signaling than on immediate actions in response to the uncertain global environment.
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The anticipated pause in interest rates may stabilize borrowing costs for consumers and businesses, but rising inflation could lead to higher prices for goods and services.
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More about Reserve Bank of India

RBI Expected to Maintain Steady Rates Amid Rising Inflation and Growth Concerns
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