RBI Monetary Policy: GDP growth forecast at 6.7% for FY26

The Reserve Bank of India (RBI) has estimated GDP maturation for the fiscal twelvemonth 2025-26 (FY26) astatine 6.7 per cent, connected the backmost of steadfast prospects for the rabi harvest and an expected betterment successful concern enactment which should enactment economical maturation successful 2025-26. This is simply a flimsy betterment from the RBI's maturation estimates of 6.4 per cent for FY25.

On the proviso side, maturation is supported by the services assemblage and a betterment successful agriculture sector, portion tepid concern maturation is simply a drag.

Quarter-wise, GDP for Q1FY26 is pegged astatine 6.7 per cent, portion for Q2 it is projected astatine 7 per cent and for Q3 and Q4 of FY26 it is forecasted astatine 6.5 per cent each.

Assessing the existent maturation trend, the Governor's connection said,  "As per the archetypal beforehand estimates, existent GDP maturation for the existent twelvemonth (FY25) is estimated astatine 6.4 per cent, a softer enlargement aft a robust 8.2 per cent maturation past year." Nevertheless, going forward, economical enactment is expected to amended successful the coming year. 

Among the cardinal drivers connected the request side, household depletion is expected to stay robust aided by the taxation alleviation successful the Union Budget 2025-26. Fixed concern is expected to recover, supported by higher capableness utilisation levels, steadfast equilibrium sheets of fiscal institutions and corporates, and Government’s continued accent connected superior expenditure, noted the monetary argumentation statement.

This is corroborated by affirmative concern sentiments highlighted successful the Reserve Bank’s endeavor surveys and PMIs. Resilient services exports volition proceed to enactment growth, it added.

Nonetheless, the RBI noted thatthe challenges stemming from geopolitical tensions, protectionist commercialized policies, fluctuations successful planetary commodity prices, and uncertainties successful fiscal markets persist arsenic imaginable threats to the outlook.

The Monetary Policy Committee (MPC) connected the sidelines, unanimously chopped the repo rate--the complaint astatine which RBI lends money to commercialized banks--by 25 ground points to 6.25 per cent.