New Delhi: The Reserve Bank of India (RBI) may keep the repo rate unchanged at its upcoming December monetary policy review meeting, given that the country's economy reported strong 8.2 per cent GDP growth in the July-September quarter.

The next Monetary Policy Committee (MPC) meeting is scheduled for December 3-5, 2025.

According to an SBI Research report on Sunday, expectations built over the past few days for a shallow 25-basis-point rate cut appear to have faded, as finer readings of the strong Q2 growth print and the evolving playbook tilt the balance in favour of a pause in December monetary policy.

"Expectations built till a few days back of a shallow rate cut of 25 bps appear to have faded as finer readings of the strong Q2 growth print and the evolving playbook make the choice tilted in favour of pause in December policy," the report read.

According to the SBI Research report, the broader trend is that monetary policy has entered a phase of pause with differences across geographies.

But, the SBI Research report suggested that it is important to continue with decisions beyond direct rate actions, but towards affirmative actions outside policy space.

In a unanimous decision, the Monetary Policy Committee (MPC) of the RBI kept the policy repo rate unchanged at 5.5 per cent in its October policy announcement.

The RBI governor noted that headline inflation had moderated considerably, providing the MPC with confidence to maintain the rate stance.

The RBI had, in its October meeting, revised the inflation target for the current financial year to 2.6 per cent, marking a significant moderation from earlier projections of 3.1 per cent. In the August policy as well, the inflation target was revised downwards to 3.1 per cent, down from 3.7 per cent projected in June.

As per the RBI Governor, this improvement in inflation has mainly been driven by a sharp decline in food prices and the rationalisation of Goods and Services Tax (GST) rates.

Inflation had been a concern for many countries, including advanced economies. However, India has largely managed to steer its inflation trajectory in a favourable direction. The RBI held its benchmark repo rate steady at 6.5 per cent for the eleventh consecutive time, before cutting it for the first time in about five years in February 2025.