RBI Monetary Policy Highlights: MPC Neither Dovish Nor Hawkish, Says Guv After Third Straight Rate Pause

That's all for today, readers! See you tomorrow for another market session as NDTV Profit continues to bring all back-to-back updates from D-Street to keep you ahead of the curve.

Stay connected!

RBI Monetary Policy Live Updates: Will Home Loan EMIs Change After RBI MPC's Decision? What Borrowers Need To Know

The central bank's decision influences borrowing costs, loan EMIs and deposit returns with change in the benchmark repo rate.  A repo rate cut can reduce EMIs and make loans cheaper, while a hike increases borrowing costs and may extend repayment periods. As a result, people need to be aware of such decisions to ensure they plan their budget and investments accordingly.

Impact On Loan And EMIs:

Fixed-rate loans: Home and car loans with fixed interest rates are not affected by changes in the RBI's policy rate.

Floating-rate loans: Home and car loans linked to floating interest rates are directly impacted by RBI's repo rate decisions, which can affect EMIs and repayment costs. With the RBI keeping rates unchanged, banks are unlikely to make any immediate changes to lending rates or EMIs.

READ MORE HERE

#NDTVProfit News Break Confirmed

NDTV Profit first reported on July 17 that India could be moving towards polymer currency notes.

RBI Governor Sanjay Malhotra has now indicated a potential FY28 rollout. @Shrimichoudhary https://t.co/KKblk1I8q1

— NDTV Profit News (@NDTVProfit) August 5, 2026

 

On July 17, NDTV Profit reported that the Reserve Bank of India (RBI) is set to begin the first pilot rollout of polymer banknotes soon, marking the next phase in the central bank's plan to introduce the new-generation currency. Official sources told NDTV Profit.

The pilot is likely to begin with smaller —Rs 10 and Rs 20 denomination banknotes. Based on the outcome of the trial, the RBI is expected to move towards a full-scale rollout from 2027, sources said. READ MORE HERE

The introduction of polymer banknotes will not replace the existing paper currency. Instead, polymer and paper banknotes will coexist, with the new notes being introduced in a phased manner while the current paper notes continue to remain in circulation, they underlined.

The move gathers momentum after the RBI's note-printing arm floated a global Expression of Interest (EOI) for the manufacture and supply of polymer substrate sheets, the specialised material used to print polymer banknotes. 

 

RBI Monetary Policy Live Updates: Governor Sanjay Malhotra said during the post policy press conference that the US effective tariff rates are much lower. The impact of US tariff will likely be much lower than expected, added Guv Malhotra.

RBI Monetary Policy Live Updates: NDTV Profit Newsbreak on polymer currency notes confirmed.

Guv Malhotra says: "Hope to launch polymer currency notes by start of FY28. Will test polymer bank notes in various conditions. Polymer bank notes increase durability, lifespan." NDTV Profit had reported on polymer currency notes on July 17.

'Costs have be paid by someone for the public infrastructure of digital payments,' says RBI governor Sanjay Malhotra on how RBI planning to impose MDR on UPI transactions.

RBI governor on NDTV Profit's @PiyushS_07's questions during the RBI press conference. pic.twitter.com/vg07jyrD8r

— NDTV Profit News (@NDTVProfit) August 5, 2026

RBI Monetary Policy Live Updates: NDTV Profit's Piyush Shukla asks Guv Malhotra over the new tax bill amendments

''Ultimately it is the consumer in some way or other who is paying for digital payments. It is important to continue to invest in digital payment infrastructure. IT systems of our major banks is quite strong, robust. Banks have put in place checks and balances to ensure they are secured against cyber fraud,'' said Guv Malhotra.

RBI Monetary Policy Live Updates: ''Liquidity may be in surplus for the very short term. Liquidity may peak around September. Expect liquidity to get absorbed going forward on account of regular needs. Liquidity in the system is not extraordinarily high. Costs have be paid by someone for the public infrastructure of digital payments,'' said Guv Malhotra

RBI Monetary Policy Live Updates: ''It is quite possible that the rupee may strengthen further. Our policy has always been that the markets determine the level, band of Rupee. We only intervene in currency market in case of excessive volatility. It will be our endeavour that the trajectory for Rupee remains orderly. Will ensure that there are no self-fulfilling expectations being built into the currency. FCNR-B flows have been robust, scheme has ticked all the boxes,'' said Guv Malhotra

RBI Monetary Policy Live Updates: No proposal to close FCNR-B scheme

''We have got robust flows through the FCNR-B route. There is no proposal under consideration to close FCNR-B scheme prematurely. The underlying fundamentals of Indian economy are very strong. Argument has been made by some people that the currency is undervalued,'' said Guv Malhotra.

RBI Monetary Policy Live Updates: RBI Governor Sanjay Malhotra begins post-policy press conference

RBI Governor says:
''We are neither dovish nor hawkish. We feel that this is the right policy rate for the given growth-inflation dynamics. There is a lot of uncertainty, which will of course play out. Our target is headline inflation and not core inflation. We will continue to be guided by the headline inflation. It is our endeavour to bring headline inflation in line with target over the medium term. We look at core and core-core inflation because we need to judge underlying inflation. Would not like to bring volatility into our policy repo rate.''

Why did the RBI sound tough on inflation despite holding rates steady?

Dr. Ashima Goyal, former MPC member, explains the reasoning behind the central bank's messaging, India's resilience, and what it means for markets.@Heeraal @alexandermats #RBIPolicy pic.twitter.com/kLaH0Nrf4f

— NDTV Profit News (@NDTVProfit) August 5, 2026

 

RBI Monetary Policy Live Updates: Former MPC member Dr Ashima Goyal explains the MPC's comments on headline inflation pressures in FY27 amid global headwinds.

RBI Monetary Policy Live Updates: On the MPC decision, Rahul Singla, Director, MAPSKO Group said, "The RBI's decision to keep the repo rate unchanged at 5.25% underscores its commitment to maintaining a fine balance between economic growth and financial stability. The real estate sector has demonstrated remarkable resilience, with demand continuing to remain robust across key markets.''

''Real estate has consistently been regarded as one of the most reliable long-term wealth creation avenues, and a stable monetary policy further reinforces this confidence. The decision is also expected to support developers by ensuring better financial visibility, improved liquidity, and greater confidence in planning and executing projects efficiently,'' said Singla.

RBI Monetary Policy Live Updates: Pranay Aggarwal Director & CEO of Stoxkart analyses RBI MPC verdict; 'RBI Maintains Wait-and-Watch Approach as Inflation Takes Centre Stage'

''The RBI’s latest monetary policy reflects a clear 'wait-and-watch' approach with a temporary tilt toward inflation management. By unanimously keeping the repo rate unchanged at 5.25% and maintaining a neutral stance, the MPC has signaled that while India's growth outlook remains resilient—with FY2026-27 GDP projected at 6.7%—it wants greater clarity on monsoon distribution, energy prices, and global geopolitical developments before considering any policy action,'' said Aggarwal.

Although core inflation remains benign at 2.3–2.5% (excluding precious metals), headline CPI inflation is expected to peak at 5.9% in Q3 due to supply-side pressures in food and fuel. For equities, the policy largely reinforces a range-bound but constructively selective outlook. The rate pause was widely anticipated and therefore brings no negative surprises for the markets.

At the same time, steady economic growth and intact corporate demand drivers continue to support the broader earnings outlook. However, elevated inflation expectations for Q3 and persistent global volatility may limit sharp valuation re-ratings in the near term, keeping investor focus on sectors with strong margin visibility and lower input-cost sensitivity, including banking, domestic consumption, and infrastructure.

The RBI’s messaging suggests that inflation has become its immediate priority. Rising inflation projections—driven by adverse weather conditions linked to El Niño, volatile global energy markets, and supply disruptions—have prompted the central bank to prioritize anchoring inflation expectations. At the same time, resilient domestic activity, supported by investment, services momentum, and stable credit demand, provides sufficient room to maintain policy stability while focusing on inflation control.

From an FPI perspective, today's policy is more of a confidence-building measure than a catalyst for fresh inflows. Previous policy decisions have shown that stable rates, a neutral stance, and inflation within the tolerance band do not automatically result in sustained foreign investment, even though India's strong growth story remains well recognized by global investors.

''While July 2026 witnessed net FPI inflows, indicating improving foreign sentiment, sustained inflows over the coming quarters will depend not only on RBI policy but also on supportive government measures to strengthen market access and growth incentives, alongside favorable global liquidity conditions, particularly US bond yields and the Fed's policy trajectory,'' said the market analyst.
 

RBI Monetary Policy Live Updates: Sandeep Agarwal, Executive Director – Finance & Group CFO, Elan Group, said on the MPC verdict, “The RBI’s decision to maintain the repo rate at 5.25% provides stability and greater visibility for long-term investment decisions amid evolving global and economic conditions.''

''For the real estate sector, a stable rate environment supports buyer confidence and strengthens the outlook for projects backed by strong fundamentals, strategic locations and credible execution. This will continue to support sustainable growth across all housing segments,'' said Agarwal.

RBI Governor Sanjay Malhotra announced draft guidelines for the licensing of urban co-operative banks and plans to harmonise the regulatory framework governing interest rates on advances. pic.twitter.com/kuayFsqkZQ

— NDTV Profit News (@NDTVProfit) August 5, 2026

 

RBI Monetary Policy Live Updates: Draft guidelines for the licensing of urban co-operative bank 

RBI Monetary Policy Live Updates: Through conduct of two-way operations, RBI to ensure sufficient liquidity. Gross FDI inflows were buoyant at $30.7 bILLION in Q1. Net FDI inflows increased during Q1. FPI to India has seen a turnaround in June and July. FPI inflows driven primarily by bond market inflows. Balance of payments expected to register healthy surplus. Forex reserves continue to be adequate with import cover of 10 months. 

RBI to continue with policy of exchange rate being determined by market forces. RBI to continue to check excessive volatility in forex market. RBI to issue draft guidelines for licensing of urban co-operative banks. RBI ATo harmonise, standardise regulatory framework on interest rates on advances, said RBI Guv.

RBI Monetary Policy Live Updates: CPI inflation in FY27seen at 5%, 10 bps lower than earlier forecast. Q2 CPI inflation seen at 4.7%. Q3 CPI inflation seen at 5.9%. Q4 CPI inflation seen at 5.5%. Q1 FY28 CPI inflation seen at 5.3%. Core inflation in FY27 seen at 4.3%. 

Core inflation barring precious metals seen lower than 4.3% in FY27. G-Sec yields buoyed by measures by government, RBI eased. Transmission in the credit market moderated slightly in May, June. Credit growth continues to remain robust, broad-based across various sectors

RBI Monetary Policy Live Updates: MPC on GDP growth estimates-

• Q1 GDP growth seen at 7%
• Q2 GDP growth seen at 6.4%
• Q3 GDP growth seen at 6.5%
• Q4 GDP growth seen at 6.8%

Guv Malhotra said risks to growth are evenly balanced. Global energy price volatility blurs near term visibility. Proactive supply management, adequate stock of foodgrain to provide comfort.

RBI Monetary Policy Live Updates: RBI Guv Malhotra speaks

• Government's initiatives expected to mitigate impact of deficient rainfall
• Growing diversification of global supply chains should mitigate impact on manufacturing
• Supported allied sector activity could mitigate impact of monsoon on rural economy
• Strong capacity utilisation, robust credit flow, government thrust in infra to sustain investment activity
• Renewed tensions in West Asia, volatility in financial markets, weather-related shocks pose downside risk to growth

RBI Governor Sanjay Malhotra says India's economy performed better than expected in Q1.

However, renewed West Asia tensions, monsoon risks, and global volatility remain key concerns. #RBIPolicy pic.twitter.com/tkoacjbpyI

— NDTV Profit News (@NDTVProfit) August 5, 2026

 RBI Monetary Policy Live Updates: RBI Governor Sanjay Malhotra highlighted the GDP growth and resilience across sectors in Q1, despite global headwinds, in the policy statement.

RBI Monetary Policy Live Updates: MPC underscored that it will maintain close vigil. Supply-side pressures caused by West Asia crisis eased somewhat since June. The MPC aw normalisation of key input supply since June. Re-escalation of conflict led to renewed uncertainty about supply chain AND resilience in domestic high frequency indicators. 

Early results for corporates in Q1 exhibit resilience. Private consumption continues to be driven by buoyant discretionary spending. Merchandise exports rebounded with double-digit growth. Overall the Indian economy performed better than expected in Q1. Prospects for Agriculture are clouded due to progress of South West Monsoon, according to Guv Malhotra.

RBI Monetary Policy Live Updates: The central bank's decision to keep rates on hold comes even as peers including Indonesia, Philippines and others have raised borrowing costs to counter higher energy prices and currency pressures brought on by the Iran war. Instead it announced a series of steps at the previous meeting to boost capital inflows and support the rupee.

RBI Monetary Policy Live Updates: The headline inflation is expected to rise further in the near term. Headline inflation likely to peak in Q3 and moderate after Q3. The economic growth continues to be supported by resilient domestic demand. India's position as the fastest growing major economy has been reinforced, according to the MPC members.

Growth, albeit resilient, is expected to be lower in FY27. Core inflation continues to remain moderate, expected to decline after peaking in Q3. Need for greater clarity to emerge, especially on inflation. Any policy action must consider recalibration of policy rate in light of growth dynamics, said Guv Malhotra in his MPC address.

RBI Monetary Policy Live Updates: The MPC decided to unanimously keep repo rate at 5.25%. MPC also decided to continue with the 'neutral stance' on the monetary policy, said Guv Malhotra. The Standing Deposit Facility (SDF) rate remains unchanged at 5%, while the Marginal Standing Facility (MSF) rate and the bank rate stands at 5.5%.

MPC noted that headline inflation has edged up above target as expected. The realised inflation for Q1 remains lower than expected. The higher inflation is mostly on account of fuel, food prices. There is little sign of generalisation of price pressures so far, said Guv Malhotra.

RBI Monetary Policy Live Updates: RBI Governor Sanjay Malhotra began the MPC address saying that the West Asia conflict continues to challenge the global economy. Trade uncertainty lingers as US imposed fresh tariffs. Global economic environment has become challenging. Some central banks have tightened policy, others have remained vigilant, he said.

Ahead of the RBI policy, markets expect a pause on rates and stance. But the focus is on the commentary.

Upasana Chachra of Morgan Stanley outlines the key signals to watch on growth, inflation, liquidity, and the future policy path.@alexandermats @MorganStanley pic.twitter.com/pcz0vndgGF

— NDTV Profit News (@NDTVProfit) August 5, 2026

 

 RBI Monetary Policy Live Updates: Upasana Chachra of Morgan Stanley outlines the key signals to watch on growth, inflation, liquidity, and the future policy path.

RBI Monetary Policy Live Updates: India's retail inflation rate breached the RBI's target for the first time in 17 months, accelerating to 4.38% in June. Signs are emerging that price pressures may prove more persistent. READ MORE HERE

The country's largest consumer companies are preparing a second straight quarter of price increases on products ranging from toothpaste to tires and paint, adding to signs that higher input costs are being passed on to consumers.

The RBI targets inflation at the 4% midpoint of the tolerance band, and Malhotra has said policymakers would respond only if price pressures become more broad-based rather than driven by temporary supply shocks. 

"We think the best thing to do amid this volatility is nothing," Barclays Plc economist Aastha Gudwani wrote in a note. Policymakers face an environment that is "no less challenging" than in June, supporting the case for the MPC to remain on pause, she said.

RBI Monetary Policy Live Updates: The RBI's repo rate currently stands at 5.25%, after the central bank reduced it by 100 basis points in 2026 to support economic growth. The repo rate is the interest rate at which the RBI lends short-term funds to commercial banks, and any change in it influences borrowing costs, home loan EMIs, deposit rates and overall liquidity in the economy.

RBI Monetary Policy Live Updates: The RBI will stream the monetary policy announcement and Governor Sanjay Malhotra's post-policy address live on its official website and social media platforms. Viewers can also follow real-time updates, analysis and key takeaways on NDTV Profit's digital platforms and YouTube channel. READ MORE HERE

RBI Monetary Policy Live Updates: Key Indicators To Watch

• Repo rate decision
• Monetary policy stance
• Inflation forecast
• GDP growth outlook
• Governor Sanjay Malhotra's commentary on global risks and liquidity

RBI Monetary Policy Live Updates: The RBI's three-day Monetary Policy Committee meeting is scheduled from Aug. 3 to Aug. 5. Governor Sanjay Malhotra will announce the policy decision and address the media at around 10 a.m. IST on Aug. 5.

RBI Monetary Policy Live Updates: The central bank's six-member repo-rate panel MPC, headed by Governor Sanjay Malhotra, is expected to leave the repurchase rate unchanged at 5.25%, according to all but one of 30 economists surveyed by Bloomberg. Policymakers are also likely to retain a neutral stance as inflation remains well within the RBI's 2%-6% tolerance band. RBI Governor Malhotra will unveil the monetary policy verdict at 10:00 am. The MPC panel will also conduct a post-policy press conference at 12 noon.

Stay tuned to NDTV Profit for all back-to-back live updates of RBI Monetary Policy Review announcements on Wednesday, Aug. 5, 2026.

RBI Monetary Policy Live Updates: Hello and welcome to NDTV Profit's live coverage of Reserve Bank of India's monetary policy committee decision on Aug. 5, 2026! Stay tuned to our live blog as we bring you all major updates on RBI Governor Sanjay Malhotra-led MPC verdict on the benchmark repo rate, inflation-cum economic growth projections, and other related policy announcements. The RBI is expected to keep interest rates unchanged on Wednesday as policymakers assess whether higher energy costs from the renewed Middle East conflict spill over into broader inflation before raising borrowing costs.