New Delhi, Aug. 8 -- The Reserve Bank of India's (RBI) decision to keep the repo rates unchanged in the August policy cycle is seen as a technical pause driven by inflation projections and growth dynamics, according to a report by SBI.

The SBI report noted that inflation is expected to remain below 3 per cent till the third quarter of FY26 but could rise sharply to 4.9 per cent in the first quarter of FY27.

In such a scenario, and with expectations of robust GDP growth, the report added that the current 5.5 per cent repo rate may turn out to be the terminal rate.

It stated, "We believe that if RBI inflation projections for FY26 may remain correct then 5.5 per cent repo rate may be the terminal rate."

The SBI added that the scope for a...