US President Trump's tariff policy exacerbates concern; RBI leaves repo rate unchanged at 5.50 per cent

MUMBAI: The Reserve Bank of India (RBI) left the repo rate unchanged this time at 5.50 per cent. With this, the possibility of further reduction in bank interest rates ended on a sombre note. The hope of a reduction in EMIs for home, auto and personal loan customers also faded. The repo rate was cut by one per cent in February, April and June.

The repo rate was expected to be cut in the August meeting of the RBI's Monetary Policy Committee. However, US President Donald Trump's tariff policies exacerbated the economic problems. RBI Governor Sanjay Malhotra, in a press conference, shed light on the macroeconomic and financial developments, which he said demanded a steady repo rate to help the country achieve a broader economy. There are concerns that the US-imposed higher tariffs on India may affect exports. He said that the MPC has also unanimously decided to keep the Reserve Bank's stance on monetary policy neutral.