The Reserve Bank of India (RBI) has decided to keep its key repo rate unchanged at 5.5%, aligning with market expectations. This pause follows a total rate cut of 100 basis points earlier in the year. The six-member Monetary Policy Committee voted unanimously to maintain a neutral stance, preferring to evaluate the effects of previous rate reductions and tax cuts amid ongoing global trade uncertainties, including U.S.-imposed tariffs on Indian exports. RBI Governor Sanjay Malhotra emphasized a 'wait and watch' approach to allow recent policy decisions to influence the economy. Despite global headwinds, the RBI upgraded its GDP growth forecast for the current year to 6.8%, from 6.5%, following a stronger-than-expected 7.8% growth in the April-June quarter. Additionally, the central bank lowered its inflation forecast to 2.6% citing lower food prices and tax cuts even though annual inflation rose to 2.07% in August, remaining within the RBI’s 2%-6% tolerance range.