RBI Monetary Policy Updates: CRR, Repo Rate See Sharp Cuts; Gold Loan Rules Likely To Ease

The RBI has changed its stance from 'Accommodative' to 'Neutral'. The CPI Inflation has also been revised downward to 3.7% for financial year 2026.

(Source: PTI)

The RBI has cut interest rate by 50 basis points to 5.5% said RBI Governor Sanjay Malhotra. RBI has also changed its stance from 'Accommodative' to 'Neutral'.
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RBI Repo Rate Cut Live: Key Highlights

Top five key takeaways:

  • Jumbo rate cut of 50 basis points; repo rate at 5.5% now.

  • Changes stance to 'Neutral' from 'Accommodative'.

  • FY26 CPI Inflation projection down at 3.7% vs 4% earlier.

  • CRR cut by 100 bps, at 3% now versus 4% earlier.

  • FY26 GDP growth projection unchanged at 6.5%.

Read full story here.

RBI Monetary Policy Live Updates: Rupee Closes Stronger

The Indian rupee closed 16 paise stronger at 85.64 against the US dollar on Friday in comparison to its previous close of 85.80 on Thursday. This significant appreciation comes amid various global and domestic economic factors influencing the currency markets.

The domestic currency opened 6 paise weaker at 85.86 against the US dollar on Friday. However, the Rupee was trading stronger "after RBI’s MPC cut rates by 50-bps, more than expectations" said Sriram Iyer, Senior Research Analyst at Reliance Securities.

RBI Monetary Policy Live Updates: Rate Cut Ripple Effect Will Boost Agricultural Activities

"Overall, this move will augur well for the food services sector in terms of a reduced input cost, as a ripple effect of lowered rates that will boost agricultural activities and income of rural households," Sanjay Kumar, CEO & MD, Rassense Pvt.

RBI Monetary Policy Live Updates: Change In Stance Aimed At Tempering Any Potential “Irrational Exuberance” In Market

The policy stance has been shifted from ‘accommodative’ to ‘neutral’. "Although this change might be read as a signal that the rate cut cycle is nearing its end, we believe it is aimed at tempering any potential “irrational exuberance” in the financial markets," said Sujan Hajra, Chief Economist & Executive Director, Anand Rathi Group.

RBI Monetary Policy Live Updates: Axis Bank To See Rate Cut Because of Rate Cut

RBI's rate cut will trigger a flurry of rate cuts on savings accounts, said Axis Bank's Rajiv Anand. He also added that the bank would see margin pressure because of the rate cut.

RBI Monetary Policy Live Updates: CRR Cut To Boost Banks' Margins, Accelerate Rate Transmission, Says Governor

The reduction in cash reserve ratio by 100 basis points in a staggered manner will ease the cost of funding for banks and will also help improve their net interest margins by 7 bps, Reserve Bank of India's Governor Sanjay Malhotra said during post policy conference on Friday.

The CRR, which has traditionally hovered around 4%, was temporarily reduced by 1% during the Covid-19 pandemic to provide liquidity relief.

Governor Malhotra noted that maintaining a 4% CRR may no longer be necessary, and a 3% ratio will be sufficient for liquidity management. This reduction will free up more funds for banks to deploy in lending activities, thereby lowering their cost of funds and enhancing profitability.

He said that the reduction in CRR is designed not only to provide liquidity but also to accelerate the transmission of monetary policy rate cuts to the real economy. Historically, transmission of policy rate changes to lending and deposit rates has taken 6-9 months. However, this time around, the RBI has observed a much faster pace.

RBI Monetary Policy Live Updates: Analysts See Pause After Jumbo Rate Cut

The Monetary Policy Committee cut the repo rate by 50 basis points to 5.5%, changed stance to 'neutral' from 'accommodative', and cut the Cash Reserve Ratio by 100 basis points from 4% to 3% of NDTL.

After having reduced the repo rate by 100 basis points, monetary policy is left with limited space to support growth, RBI Governor Sanjay Malhotra said during his monetary policy speech. The MPC will carefully assess the incoming data and the evolving outlook to chart out the future course of monetary policy, he said.

Unless there are major economic surprises, the RBI will be on hold in August and beyond, according to Nomura. However, the policy outlook will depend on the macro outlook. "We see downside risks to the RBI’s GDP growth and CPI inflation outlooks," Nomura said. GDP growth is likely to surprise lower at 6.2%, while CPI inflation is tracking even lower at 3.3%, as per Nomura's estimates. While the RBI forecasts GDP growth in FY26 at 6.5%, it has revised the CPI inflation forecast to 3.7%.

Also Read: RBI Monetary Policy: Analysts See Pause After Jumbo Rate Cut

RBI Repo Rate Cut Live: Here's How Home Loan Borrowers Are Set To Benefit

Reserve Bank of India on Friday cut the repo rate by 50 basis points to 5.5% and shifted its monetary policy stance from 'accommodative' to 'neutral', marking a mixed outcome for borrowers and savers.

Announcing the decision after the Monetary Policy Committee’s meeting in Mumbai, RBI Governor Sanjay Malhotra said the move is aimed at lowering borrowing costs amid a favourable inflation outlook.

The move brings immediate relief to home loan borrowers. Those with loans linked to the External Benchmark Lending Rate are likely to see interest rates fall in the upcoming reset cycle. "Rate cut makes home loan EMIs easier, improving affordability," said Anarock Property Consultants.

Read full story here.

RBI Repo Rate Cut Live: Won't Fail In Our Duty If We Have To Step In For IndusInd Bank Issues, Said Governor

The RBI Governor said that IndusInd Bank's MD and CEO have resigned, that should be good enough. In case of fraud the law will take its course.

"Won't fail in our duty if we have to step in," he added.

He further said that the markets and media should not be speculative on IndusInd Bank fraud.

RBI Repo Rate Cut Live: No Systemic Impact Arising From IndusInd Bank Issue, Says DG Swaminathan

Episodes like this don't bother us if they are few and far between, said the RBI Governor on the issue of IndusInd Bank.

DG Swaminathan added that there is no systemic impact arising from IndusInd Bank issue and the priority is that customers don't face any loss.

IndusInd Bank issue should settle down very soon and will keep monitoring banking system, he added.

RBI Repo Rate Cut Live: No Credit Check For Gold Loans Up To Rs 2.5 Lakh, Says Governor

Following the government's feedback on draft gold loan norms last week, the Reserve Bank of India's Governor Sanjay Malhotra said that all such loans with a ticket size of up to Rs 2.5 lakh loans will likely be exempted.

On loan-to-value ratio, he said that it should only be 85% for consumption loans and 85% LTV must be maintained by lenders for small ticket gold loans under Rs 2.5 lakh and interest must be applied.

He said that declaration of ownership will be enough for gold loans and that lenders do not need credit appraisal for gold loans up to Rs 2.5 lakh crore.

Speaking on end-use of monitoring of these loans, Malhotra said that end-use of gold loans will only be monitored when lenders would seek the benefit of priority sector lending norms.

He said that the central bank is working on these gold loan regulations and it should be released by Monday latest, Malhotra said.

RBI Repo Rate Cut Live: Liquidity, Reduced Cost Of Funding For Banks-Two Objectives For CRR Cut

CRR cut has two objectives with the first one being to provide more liquidity and the other is to reduce cost of funding for banks.

He further added that 3% is a comfortable reserve ratio to have from a liquidity management perspective.

Additional liquidity will help increase credit flow, he added. Further he said, liquidity is needed to see faster transmission of policy action.

Growth aspiration is expected to be between 7-8%.

RBI Repo Rate Cut Live: Governor Explains Growth Impact To NDTV Profit

Discussing the transmission from rate cut to real economy Governor Sanjay Malhotra said that it will be positive and the impact of the rate cut will be seen in the second half of this year.

He also reiterated that stance is dependent on data and if data demands that then RBI has to stay put, that is how it will be done.

RBI Repo Rate Cut Live: Credit Market Seeing Signs Of Rate Cut Transmission, Said Governor Malhotra

According to Governor Malhotra going by past trends, transmission of rate cuts has happened much faster.

There has been a huge transmission of rate cut in the money market, especially in shorter term levels, he added.

Credit market seeing signs of rate cut transmission, he pointed out.

He further added that there is a need to do faster transmission in markets, which is why frontloading was necessary.

RBI Repo Rate Cut Live: All 6 MPC Members In Favour To Change Stance To Neutral

RBI Governor Sanjay Malhotra said that all the six PMC members were in favour to change stance to 'Neutral'.

RBI Repo Rate Cut Live: Price Stability Is The Main Motive, Says Governor Malhotra

"We had to cut CRR, we did it in one go, we had to cut the repo rate by 50 bps, so we did it at one go," said the Governor.

He added that there is a need to provide certainty to markets and with this price stability is an important and main motive. According to him, front-loaded repo rate cut and CRR cut will provide certainty.

RBI Repo Rate Cut Live: Will Build Forex Reserves If There Are Opportunities, Says Governor Malhotra

"Will not be unduly bothered about rebuilding forex reserves," said Governor Malhotra. He further added that they will build forex reserves if there are opportunities.

RBI MPC Meeting Live: Liquidity Is Abundant, Says Governor Malhotra

"Liquidity is abundant, will see how situation evolves," says Govenor Sanjay Malhotra.

He further added that the RBI hasn't thought where interbank call money rate should be.

He also added that if RBI don't do VRRRs then the call rate will stay at 5.25%.

RBI MPC Meeting Live: CRR Move Could Indicate Uncertainty Whether That Liquidity Can Sustain, Says UBS

"I didn’t realise that the RBI will go ahead towards CRR, which means they were uncertain whether that liquidity can sustain or not," said Tanvee Gupta Jain, UBS Securities.

She said the 50 bps cut was a surprise but noted that a section of the market had expected it. She added the RBI now has a 25-50 basis point buffer if growth weakens further.

Also Read: RBI’s Triple Surprise Is A Liquidity Lifeline, Say Experts

RBI Monetary Policy Live Updates: Muthoot Microfin Rates 10/10

Sadaf Sadaf Sayeed, CEO, Muthoot Microfin, gives the RBI Policy outcome a 10 out of 10 rating with an "all-round" focus.

“It is great to see both GOI fiscal policy and RBI monetary policy working in tandem to propel the Indian economy to a new growth trajectory. It augurs well for the industry and our country,” he added.

RBI Monetary Policy Live Updates: RBI Rate Cut To Help Sustain Growth Momentum Says Ajay Seth

“These (RBI Rate Cut) will help in enriching and sustaining the growth momentum, and facilitate private investment,” Finance Secretary Ajay Seth told NDTV Profit.

RBI Monetary Policy Live Updates: CRR Reduction To Aid Developers To Get More Capital Access From Banks

While the rate cut will make home loan EMIs easier improving affordability, CRR to aid developers to get more capital access from banks said Anarock.

Affordable and mid-income segments to potentially see demand boost after the rate cut

RBI Repo Rate Cut Live: Change Of Stance A Disappointment, Says RBL Bank's Jaideep

The RBI on Friday changed its stance to 'Neutral' from the earlier 'Accommodative' this according to Jaideep Iyer, Head of Strategy, RBL Bank was a disappointment.

He added that more rate cuts will be subject to data and growth and inflation dynamics.

It is evident that liquidity is going to be easy, and it gives confidence to lower rates on the banking side, he said.

RBI Repo Rate Cut Live: Nifty, Sensex At Day's High; Nifty Bank Hits Record High Post RBI Rate Cut

The NSE Nifty 50 and BSE Sensex both advanced 0.83% and 0.77% higher, respectively. The indices were trading at day's high as of 11:02 a.m.

The NSE Nifty Bank index rose 0.80% to a record high of 56,205 as HDFC Bank Ltd. and Axis Bank Ltd. share prices led. The Reserve Bank of India reduced repo rate by 50 basis points to 5.5% against 25-bps cut expected.

The central bank also reduced the cash reserve ratio by 100 basis points to 3% in the June policy meeting. These moves are expected to boost the monetary system of the country.

Also Read: Nifty Bank Hits Fresh High As RBI Cuts Repo Rate To 5.5%, CRR By 100 Basis Points

RBI Repo Rate Cut Live: The Policy Suggests Urgency To Bring Back Credit Growth, Says Bernstein

According to Pranav Gundlapalle, Senior Research Analyst, Bernstein, the policy seems to suggest that there is urgency to bring back credit growth. He also added that the policy is good for the banking sector allowing lenders to lend more aggressively.

RBI Repo Rate Cut Live: Uday Kotak Calls It 'Bold And Strategic'

Uday Kotak Founder and Director of Kotak Bank calls RBI's 50 basis points repo rate cut as a 'Bold and Strategic' move.

RBI Repo Rate Cut Live: Big Booster To Get Growth Back On Fast Track, Says A Bala

"RBI has surprised the market by cutting repo rate by 50 basis points to 5.5% and CRR by 100 basis points supporting the growth. In fact they have advanced the rate reduction and changed the outlook to neutral... big booster to get growth back on fast track ..positive for equity market outlook going forward," said A Bala Birla Sunlife.

RBI Repo Rate Cut Live: India Progressing Well On Both Inflation And Growth Fronts, Says Governor

India is progressing well on both inflation and growth fronts, said RBI Governor.

He further added that as global environment remains uncertain, it has become more important to focus on domestic growth.

"Today's MPC actions should be seen as a step to propel growth," said Malhotra.

RBI Repo Rate Cut Live: RBI Cuts CRR By 100 Basis Points

RBI cuts CRR by 100 basis points from 4% to 3%, said RBI Governor Sanjay Malhotra. CRR cut to be done in 4 staggered stages. CRR cut to release Rs 2.5 lakh crore in liquidity and expected to reduce cost of funding for banks.

RBI Repo Rate Cut Live: Gross FDI Remain High, Says RBI Governor Sanjay Malhotra

India continues to be an attractive investment destination, said RBI Governor Sanjay Malhotra while adding that the gross FDI remain high.

He further said that the moderation in net inflows is primarily on the back of repatriation.

Additionally, he pointed that net FDI are important for forex reserves.

RBI Repo Rate Cut Live: CPI Inflation Revised Downward

CPI Inflation has been revised downward to 3.7% for financial year 2026 in comparison to 4% estimated in April 2025. On a quarterly basis the CPI for the first quarter was revised to 2.90% from 3.6%, for the second quarter it was revised to 3.4% to 3.9%. In the third and the fourth quarter it was at 3.9% and 4.4% respectively.

RBI Repo Rate Cut Live: GDP Growth Unchanged At 6.5%

The GDP growth for fiscal 2026 is unchanged at 6.5%. For the first quarter it is at 6.5%, in the second quarter it is projected at 6.7%, and in the third and fourth quarter it is projected to be AT 6.60% and 6.30%, respectively.

RBI Repo Rate Cut Live: Stance Changed To 'Neutral'

The RBI has changed its stance from 'Accommodative' to 'Neutral'.

RBI Repo Rate Cut Live: CPI Inflation Revised Downward To 3.7%

CPI Inflation has been revised downward to 3.7% for financial year 2026 in comparison to 4% estimated in April 2025.

RBI Monetary Policy Live Updates: Repo Rate Cut By 50 Basis Points To 5.5%

The RBI has cut interest rate by 50 basis points to 5.5% said RBI Governor Sanjay Malhotra.

RBI Monetary Policy Live Updates: Emerging Market Central Banks Have Tougher Tasks Against Spillovers, Says Governor Sanjay

Emerging market central banks have tougher tasks against spillovers, said RBI Governor Sanjay Malhotra after the MPC meet.

RBI Monetary Policy Live Updates: Last Mile Of Inflation Turning Out To Be Little More Protracted, Says Governor Sanjay

Global growth and trade projections have been revised downwards globally and the last mile of inflation turning out to be little more protracted, says RBI Governor Sanjay Malhotra.

RBI Monetary Policy Live Updates: Governor Sanjay Malhotra Begins Address

Global backdrop remains fragile and highly fluid says Governor Sanjay Malhotra as he begins address after the MPC meet.

RBI Monetary Policy Live Updates: CLSA Expects Additional 50-75 Basis Points Rate Cuts In FY26

CLSA expects an additional 50-75 basis points rate cut in the remained of financial year 2026.

RBI MPC Meeting Live: Real Estate Expectation

"As we await the upcoming RBI monetary policy announcement, the real estate sector is hopeful for a supportive policy measure with further rate cut as it would be highly encouraging for homebuyers and developers alike. With construction costs on the rise affecting capital flows, lower interest rates would also ease financing pressures for developers," said Ramani Sastri - Chairman and Managing Director, Sterling Developers

RBI MPC Meeting Live: Where To Watch

Watch RBI Governor Sanjay Malhotra address the press conference in Mumbai where he will announce the decision of the MPC on interest rate.

RBI MPC Live Updates: Nifty, Sensex Open Flat

The NSE Nifty 50 and BSE Sensex opened flat on Friday as investors remained on the sidelines before the Reserve Bank of India's rate decision. Most traders expect the central bank to deliver a quarter-basis-point rate cut.

HDFC Bank Ltd. and ICICI Bank Ltd. were top detractors of the Nifty 50 index.

The Nifty 50 and Sensex were trading 0.02% and 0.08% down respectively as of 9:23 a.m.

Track live market updates here.

RBI MPC Meeting 2025 Live: 10-Year Bond Opens Flat

The yield on the 10-year bond opens flat at 6.25% before RBI rate decision

Source: Bloomberg

RBI Monetary Policy Live Updates: Rupee Opens Weaker Against Dollar As Market Awaits MPC Decision

The Indian rupee opened 6 paise weaker at 85.86 against the US dollar on Friday, in comparison to its previous close of 85.80 on Thursday. This slight depreciation comes amid various global and domestic economic factors influencing the currency markets.

RBI MPC Meeting Live: GDP View

The GDP growth rate rose to a four-quarter high of 7.4% in the January-March period, while GVA rose 6.8% during the fourth quarter. For the full year, GDP is estimated to have grown by 6.5%, which is the same as compared to the second advance estimate of 6.5%.

However, the key driver of higher GDP growth was also the widening of net indirect taxes due to lower subsidies, which added 1.3 percentage points to headline growth, said Gudwani. Real GVA growth at 6.8% was also higher than estimate, explained by the upward revision of the Q3FY25 print, and better operating profit growth driving up manufacturing GVA, said Gudwani, who retained the growth forecast at 6.5% for FY26 as well. 

RBI Monetary Policy Live Updates: Committee Schedule For 2025-2026

The next RBI Monetary Policy Committee meetings for financial year 2025-26 will be held on the following dates:

  • Aug. 5-7, 2025

  • Sept. 29-Oct. 1, 2025

  • Dec. 3-5, 2025

  • Feb. 4-6, 2026

The central bank holds six bi-monthly meetings annually. Previous meeting in this financial year took place in April.

RBI MPC Live Updates: April 2025 Highlights

In its previous meeting in April 2025, the MPC, led by the RBI Governor Sanjay Malhotra, unanimously decided to reduce the repo rate by 25 basis points, reducing it from 6.25% to 6%. He also changed the stance from 'Neutral' to 'Accommodative'.

It was the second rate cut since the beginning of the COVID-19 pandemic, when the MPC slashed the repo rate by 40 bps to 4% in May 2020.

Key takeaways from RBI Governor Sanjay Malhotra's speech:

  • MPC voted unanimously to cut policy repo rate by 25 bps.

  • MPC also decided unanimously to change the stance to 'Accommodative'.

  • MPC to remain unambiguosly focused to bringing inflation to target on durable basis.

  • MPC revised its growth projection for real GDP in FY26 to 6.5%, marking it down by 20 basis points.

  • The RBI Governor highlighted that global growth is being dented by trade frictions, which will impede domestic growth.

RBI Monetary Policy Live: Expectations For June MPC

The Reserve Bank of India's Monetary Policy Committee is expected to continue to cut the benchmark lending rate in June. The RBI will announce the decision on June 6.

This is shortly after better than estimated GDP growth in the January-March quarter, even as India's retail inflation has slipped to its lowest in nearly six years.

Read full story here.

RBI Monetary Policy Decision Today

The Monetary Policy Committee or MPC of the Reserve Bank of India, chaired by Governor Sanjay Malhotra, began its three-day meeting on Wednesday, June 4, to discuss the second monetary policy for financial year 2026. Key areas of the decision-making process included interest rates, inflation and growth outlook.

Malhotra will announce the decision of the six-member MPC at 10:00 a.m.

Also Read: RBI Monetary Policy Easing To Support India's Growth Amid External Risks, Says Morgan Stanley

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WRITTEN BY
Pratiksha Thayil
Pratiksha covers markets and business news at NDTV Profit. She has a keen i... more
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