RBI holds repo rate at 5 25% but warns West Asia supply shocks

Markets liked the pause, but RBI sounded a new risk alarm

The RBI kept the repo rate unchanged at 5.25%, citing persistent West Asia tensions. While its GDP and inflation forecasts stay within targets, the central bank warned that potential supply chain disruptions could still pressure inflation and weigh on growth. Despite geopolitical uncertainty, markets responded positively to the policy decision, reflecting confidence in the current stance.