India’s central bank stands at a crossroads today as the Monetary Policy Committee reveals its latest stance on repo rates. After easing in December 2025, February brings expectations of continuity, with forward-looking signals poised to dominate headlines.
The meeting, underway since Wednesday, unfolds against resilient economic indicators and transformative trade developments. Deals with the US and EU have slashed tariffs to 18%, making India one of Asia’s most attractive export bases and fortifying outward trade.
Expert Radhika Rao from DBS Bank highlights flexibility in RBI’s toolkit, driven by moderated global risks. However, persistent rupee strains and deposit challenges, coupled with inflation dynamics, militate against premature cuts. Focus shifts to non-rate measures: liquidity injections, yield curve management, and forex buffers.
Bond buying operations are set to persist into the next fiscal quarter. SBI Research notes that despite accommodative settings, hardening yields necessitate vigilance, with OMO security picks determining liquidity outcomes. Status quo emerges as the logical path.
These geopolitical trade triumphs reshape the narrative, enhancing competitiveness and growth prospects. RBI’s announcement today will not only affirm rates but illuminate the path ahead for markets navigating growth, stability, and global integration.