India

Restrictive

Policy rate

5.25%

Last move Dec 2025

Inflation

2.40%

As of null

Real policy rate

2.85%

Policy rate less inflation

Debt to GDP

83.40%

2026 est.

Inflation target4%

Policy rate vs target+1.25 pp

Last move-25 bps cut

Months at current rate8

Real GDP growth6.50%

Next scheduled decisionNot published

Policy rate path, latest five years. Cycle peak 12.00% (Oct 1991).

The verdict

India sets its policy rate at 5.25%, against inflation of 2.40% — a real rate of 2.85% after inflation. The most recent decision was a 25bp cut in Dec 2025. The rate has held there for about 8 months. The bank targets 4% inflation, and prices are running below that at 2.40%; the policy rate stands 1.25 percentage points above target. On the fiscal side, the economy carries government debt of 83.4% of GDP (2026 est.) and real GDP growth of 6.5%.

Sources: policy rate and cycle history — BIS central bank policy rates (WS_CBPOL); inflation — national statistical agencies; debt and growth — IMF World Economic Outlook. Methodology: https://www.globalfinancialinfo.info/methodology/policy-rates · Dataset: https://www.globalfinancialinfo.info/global-economy · Free to print and share for non-commercial classroom use (CC BY-NC-ND 4.0).

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