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Informist, Friday, Feb. 6, 2026

 

NEW DELHI - Dipti Deshpande, principal economist, Crisil Ltd., said the following on the Reserve Bank of India's sixth bi-monthly monetary policy for 2025-26 (Apr-Mar) detailed on Friday:

 

In line with expectations, the Monetary Policy Committee of the Reserve Bank of India kept policy rates unchanged, while maintaining the neutral stance, reflecting a wait-and-watch approach.

 

The MPC is factoring in a likely uptick in inflation in the first half of next fiscal, as growth remains strong. In addition, upcoming revisions to inflation and gross domestic product data--following changes in the methodology and base--call for prudence.

 

While the RBI governor did not explicitly announce fresh liquidity-easing measures, recent actions of Open Market Operations and forex swaps, suggest the RBI will stay proactive on liquidity. The objective is to keep lending rates easy.

 

Such actions have helped alleviate some pressure on systemic liquidity caused due to foreign capital outflows, the wider gap between bank credit and deposit growth, and the large government bond supply, which kept yields sticky. So far, the RBI's measures have helped in easing shorter-tenure interest rates.

 

The series of rate cuts by the MPC, combined with supportive fiscal measures, had lifted consumption demand.

 

Bank credit growth has risen to around 14%, the highest since September 2024. We believe the cumulative 125 basis points of repo rate reductions this fiscal should continue to support consumption into the first half of next fiscal.

 

The MPC will likely maintain pause next fiscal as the inflation trajectory ascends and growth remains healthy. The overhaul of the CPI and GDP series bears watching for changes in growth-inflation assessment. The RBI will keep the powder dry for unforeseen shocks.

 

For the current FY12 base year series, we expect inflation to tick up to 5% next fiscal from 2.5% this fiscal, driven by a statistical low-base effect for food prices, while GDP growth should moderate to 6.7% from 7.4% given prolonged global uncertainties.

 

The RBI's support to the bond market will be pivotal as government borrowing rises. The Centre has projected INR 17.2 trillion in borrowings next fiscal from INR 14.6 trillion this fiscal. State borrowings, which added pressure on G-sec yields this fiscal, need monitoring next fiscal as well.  End

 

Compiled by Priyasmita Dutta

Filed by Ashish Shirke

 

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