In its April 2025 meeting, the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) unanimously voted to reduce the policy repo rate by 25 bps to 6.0%. This decision to lower the policy rate comes amidst an improved inflation outlook and the need to support economic growth. The policy stance was also changed to accommodative from neutral, signalling the MPC may consider further rate cuts going forward. With the ongoing global trade uncertainties, RBI revised downwards the GDP growth projection for FY26 to 6.5% from their earlier assessment of 6.7%. RBI also lowered the inflation projection for FY26 to 4% from 4.2%. We expect GDP growth to be slightly below the RBI’s projection at around 6.2% in FY26, while maintaining our inflation forecast at 4.2%.