RBI’s rate pause balances inflation control, growth support: Analysts

NEW DELHI: The Reserve Bank of India’s decision to keep the repo rate unchanged at 5.25 per cent with a neutral stance reflected a balanced approach of controlling inflation and supporting economic growth, analysts said on Wednesday.

Trade association ASSOCHAM appreciated the "calibrated step aimed at strengthening stability in the macroeconomic environment", adding that it helps sustain growth momentum and ensure price stability.

"This decision underscores the central bank’s careful assessment of prevailing macroeconomic conditions and its commitment to remain flexible in responding to evolving economic developments," said Saurabh Sanyal, Secretary General ASSOCHAM.

Experts broadly opined that the pause was expected given risks from El Nino, crude prices and global uncertainty.

Madan Sabnavis, Chief Economist, Bank of Baroda, indicated dimmed likelihood of any further rate cuts as the RBI has flagged El Nino as a risk to inflation, too, and projected a GDP growth at 6.9 per cent and inflation at 4.6 per cent.