December 2025- RBI meeting highlights

Economicstaan Official
Dec 7
2 min read

Meetings at the end of the year from the central banks are always exciting; the Reserve Bank of India’s meeting is also full of surprises. The markets were speculative in terms of the decision coming in from the RBI due to the recent data releases with respect to the economy. Some of the key economic data inputs were on inflation, which is said to have cooled down significantly. Given these conditions, the central bank has cut the interest rates a cut by 25 basis points (bps).

December meeting- RBI meeting highlights

Decision highlights

This brings the interest rates from 5.5% to 5.25%, after a prolonged pause since the last two meetings since Sanjay Malhotra took office this year. With the growth numbers promising and the inflation numbers, the decision seemed to be welcomed by the markets. The members maintained a “neutral stance “ in this meeting. The previous meetings have seen an “accommodative stance.”

Growth projections

This is a welcome move as it will improve the affordability of people, as the loans would get “cheaper,” and it would improve the consumption levels in the economy. The GDP growth projections have also been revived by the governor in the current meeting. The real GDP growth for 2025-26 is projected at 7.3 per cent, with Q3 at 7.0 per cent, and Q4 at 6.5 per cent. Real GDP growth for Q1:2026-27 is projected at 6.7 per cent and Q2 at 6.8 per cent.

Inflation scenario

The inflation numbers showed a bright picture, considering the high kharif production, healthy rabi sowing season, and also the reservoir levels have been adequate throughout the year. The rains have shown some positive impact in terms of providing the soil with adequate moisture, adequate for crop growth.

With the inflation easing significantly the projections for 2026-27 have also shown a downward revision post the meeting. The core and headline inflation is likely to be under 4% least until the first half of 2026. With the growth and inflation said to be in balance, the policy gives space for the economy to support the Indian growth story.