RBI Maintains Interest Rates, Proposes Growth Boosts in October 2025 Meeting
The Reserve Bank of India's Monetary Policy Committee (MPC) has maintained interest rates in its October 2025 meeting, while announcing several proposals to boost economic growth and strengthen the financial sector.
The RBI has removed the regulatory ceiling on lending by banks on listed debt securities, aiming to enhance liquidity in the market. Additionally, it has proposed a risk-based insurance premium to better manage risks in the sector.
The RBI Governor, Sanjay Malhotra, acknowledged global headwinds, such as tariff alterations, impacting India's economic outlook. Despite these challenges, the RBI has revised its GDP growth estimates for FY26 upwards to 6.8%.
In a bid to support borrowers, the RBI has eased lending rules on gold and adjusted interest rate norms. It has also proposed to expand the scope of capital market lending by banks. Furthermore, the RBI has lowered its inflation estimates for FY26 to 2.6%.
To bolster capital adequacy, the RBI has proposed to make the revised Basel III norms effective from April 1, 2027. Notably, the RBI has also proposed to remove regulatory restrictions on overlap in businesses undertaken by a bank and its group entities.
The RBI's October 2025 meeting brought several proposals aimed at stimulating economic growth, managing risks, and supporting borrowers. While interest rates remain unchanged, the RBI's actions reflect its commitment to navigating global challenges and fostering a robust financial sector.
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