Indian benchmark indices, Sensex and Nifty, saw early gains driven by lower crude oil prices and buying in Reliance Industries, even as the Reserve Bank of India maintained its benchmark policy rate for the fourth consecutive meeting, reinforcing confidence in the domestic economy.
Members of the Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) have indicated that interest rate hikes may be necessary sooner rather than later, as headline inflation is projected to rise from its current benign levels in the coming months, according to the minutes of the August review.
The Reserve Bank of India (RBI) has maintained its benchmark policy rate at 5.25 per cent for the fourth consecutive meeting, prioritising clarity on inflation trends, particularly concerning energy costs and geopolitical developments.
The Reserve Bank of India (RBI) is widely expected to keep its benchmark repo rate unchanged in the August monetary policy review, with economists citing elevated inflation risks and the pending closure of the FCNR(B) deposit scheme as key factors. Most anticipate a 'Neutral' policy stance but with a hawkish tone due to geopolitical tensions, high crude oil prices, and an uneven monsoon.
State Bank of India Chairman C S Setty has expressed support for a 'pause' in policy rates by the Reserve Bank of India's monetary policy committee, believing it will help stabilise conditions and support economic growth. He also urged investors to look beyond short-term equity market movements and focus on India's structural transformation, driven by reforms and digital infrastructure.
RBI Governor Sanjay Malhotra stated it is "premature" to discuss the implementation of Merchant Discount Rate (MDR) for digital payments, advising a "wait-and-watch" approach. He emphasised that investment in public payment infrastructure is necessary and someone must bear the cost, whether through taxes or MDR. The government is currently working on amendments to relevant statutes, and the RBI is focused on strengthening this infrastructure.
The Indian stock market is poised for a volatile week, influenced by the Reserve Bank of India's monetary policy decision, crucial global macroeconomic data, and the escalating geopolitical tensions in West Asia, according to market analysts.
The consumer price index (CPI)-based inflation hitting an all-time low in October would encourage the six-member monetary policy committee (MPC) of the Reserve Bank of India (RBI) to cut the policy repo rate in its upcoming December 3-5 meeting. However, the July-September GDP growth, expected to be above 7 per cent, may act as a deterrent.
Analysts predict that the Reserve Bank of India's interest rate decision, the evolving situation in West Asia involving the US-Iran conflict, and crude oil prices will be the primary factors influencing investor sentiment in the Indian stock market this week.
The Reserve Bank of India (RBI) maintained its key policy rates for the fourth consecutive time, keeping the repo rate at 5.25 per cent, while the benchmark BSE Sensex closed 152 points higher in a volatile session, recovering from an intraday dip.
'The MPC is likely to prioritise the key mandate, which is inflation, while relying on other instruments to stabilise the currency and bond markets.'
RBI Governor Sanjay Malhotra stated that the central bank is closely monitoring whether the supply shock from the West Asia conflict will lead to a generalised price rise, potentially necessitating monetary policy action.
India's retail inflation rose to 4.38 per cent in June, driven primarily by costlier food items, pushing it above the Reserve Bank of India's median target of 4 per cent for the first time under the new series.
Policy rates have been reduced substantially in 2015.
Uncertainties stemming from the West Asia crisis and its potential impact on inflation and economic growth were key factors in the Reserve Bank of India's Monetary Policy Committee (MPC) decision to maintain the status quo on interest rates, according to the recently released MPC meeting minutes.
After a 25 basis point rate cut in December, the RBI on Friday decided to pause on the policy rate front amid geopolitical uncertainties.
Fitch Ratings has affirmed India's sovereign credit rating at 'BBB-' with a stable outlook, acknowledging robust growth prospects and strong external finances. However, the agency highlighted concerns over elevated government debt, lagging structural metrics, and potential fiscal spending pressures due to rising youth unemployment.
Real estate developers and consultants on Tuesday said RBI's decision to hike policy rates by 25 basis points will affect the sentiment of the property market, but they do not foresee any major impact on housing demand and prices.
India Ratings and Research predicts the Reserve Bank of India (RBI) will maintain the repo rate at 5.25 per cent throughout FY27, despite potential inflationary pressures from higher fuel prices, with inflation expected to remain within the central bank's tolerance band.
The Reserve Bank of India (RBI) has kept its key lending rate, the repo rate, unchanged at 5.25 per cent for the second consecutive time, citing concerns over rising energy prices, supply disruptions from the West Asia crisis, and potential inflationary pressures.
The Reserve Bank of India on Friday decided to keep the policy rate unchanged for the 11th time in a row but sharply lowered the GDP growth forecast to 6.6 per cent for the current fiscal, as against earlier projection of 7.2 per cent. The Reserve Bank of India (RBI) maintained the status quo on interest rate despite July-September quarter GDP growth falling to 7-quarter low of 5.4 per cent, as against its own projection of 7 per cent.
The Reserve Bank of India (RBI) has prematurely closed its swap facility for foreign currency non-resident (bank) deposits, FCNR(B), one month ahead of schedule, after banks mobilised $52.3 billion under the scheme by August 13, indicating sufficient foreign currency reserves.
Indian benchmark indices Sensex and Nifty closed marginally lower due to profit-taking, following the Reserve Bank of India's decision to keep the repo rate unchanged while lowering its growth expectations for the current fiscal year and forecasting higher inflation.
"Our endeavour is to bring headline inflation in line with the target over the medium term," said RBI Governor Sanjay Malhotra, addressing concerns about the central bank's policy stance and economic outlook.
Reserve Bank Governor Sanjay Malhotra on Friday said the key policy rates will remain at low levels for a long period and may go down even further.
India's wholesale price index (WPI) inflation marginally eased to 9.78 per cent in July 2026, down from 9.87 per cent in June, primarily due to a cooling in the prices of fuel, power, and food items, marking the first month-on-month drop under the new 2022-23 base year.
The Indian equity market is set for an event-heavy week, with analysts pointing to the Reserve Bank of India's (RBI) interest rate decision, developments in the US-Iran situation, and crude oil prices as the primary determinants of market trends.
The RBI under new Governor Sanjay Malhotra on Friday cut interest rate for the first time in nearly five years as the central bank pivoted the policy stance to support a shuttering economy. The 25 basis points rate cut to 6.25 per cent comes after last rate reduction in May 2020. The last revision of rates happened in February 2023 when the policy rate was hiked by 25 basis points to 6.5 per cent.
India's largest retirement fund manager, the Employees' Provident Fund Organisation (EPFO), is enhancing its investment governance and fund management practices, following the Reserve Bank of India's recommendations.
Gold futures saw a significant rise for the second consecutive day, driven by strong overseas market rallies, increased safe-haven demand due to geopolitical uncertainties, and a weaker US dollar. This surge coincided with the Reserve Bank of India's decision to maintain its repo rate, reflecting a focus on growth amidst global inflation concerns and easing oil prices.
Top laggards in the Sensex pack included Kotak Bank, ICICI Bank, HDFC Bank, Tata Motors, L&T, SBI, Tata Steel and Axis Bank, falling up to 3.46 per cent.
The RBI seems to be acknowledging that all deposits are not equal -- a deposit with a lower run-off assumption is inherently more valuable than one that could disappear overnight, points out Tamal Bandyopadhyay.
Under bullet repayment, the principal remains outstanding and unpaid interest raises the liability over time. This makes the LTV ratio more vulnerable to a sharp fall in gold prices.
Even if the Reserve Bank of India's Monetary Policy Committee decided to hold interest rates in the October meeting, it acknowledged the scope for further rate cuts while waiting for the impact of the past steps to play out.
Indian stock market indices closed on a mixed note, with the Sensex gaining 374 points driven by buying in Reliance Industries and ICICI Bank, while the Nifty remained flat. This divergence is attributed to a new Closing Auction Session (CAS) mechanism introduced by stock exchanges, impacting market liquidity and price discovery.
RBI Governor Sanjay Malhotra announced plans to launch long-lasting polymer currency notes by the next financial year. He also discussed the central bank's data-dependent approach to interest rates, its focus on aligning inflation with the 4 per cent target, and the orderly trajectory of the rupee amidst geopolitical tensions.
For millions of Indians, this number has become one of the most important financial indicators. It can influence not only whether a bank approves a loan but also the interest rate you pay, the credit limit you receive and, in some cases, how quickly your application is processed.
Benchmark lending rates unchanged with repo rate at 5.25%
The Reserve Bank of India (RBI) has opted to keep its key interest rates unchanged at 5.25%, anticipating a global economic recovery following a ceasefire in the US/Israel-Iran conflict, despite ongoing inflationary pressures and currency fluctuations.
Reserve Bank of India Deputy Governor Rohit Jain has stated that India cannot rely solely on bank balance sheets to fund the extensive investment required for its 'Viksit Bharat' (developed India) goal by 2047, emphasising the critical need for deeper corporate bond, foreign exchange, and derivatives markets.
