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Canara Robeco AMC CIO Avnish Jain on RBI Policy
This story was originally published at 14:19 IST on 5 August 2026
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MUMBAI - Avnish Jain, chief investment officer - fixed income, Canara Robeco Asset Management Co. Ltd., said the following on the Reserve Bank of India's third bi-monthly monetary policy statement for the financial year 2026-27 (Apr-Mar) detailed Wednesday:
RBI Monetary Policy Committee kept the repo rate steady at 5.25% with stance being maintained at neutral. The RBI MPC policy continues to be driven by incoming data, with the US-Iran war creating uncertainty and risks on monsoons from El Nino. The policymakers believe that inflation has largely been driven by supplyside shocks and broad-based price pressures are limited. RBI MPC increased the GDP growth projection to 6.7% whilst reducing CPI projection to 5% for FY27. Liquidity is expected to remain benign as forex (foreign exchange) inflows from FCNR(B) (foreign currency non-resident (banks)) and ECB (European Central Bank) deposits remain robust.
The policy was as per market expectations, and rates did not react much to the announcement. 10Y GSEC (10-year benchmark government bond) yield had opened lower at 6.77-6.78% on crude (oil) prices trading below US$80/bbl (on renewed chatter on talks between US-Iran to open the Strait of Hormuz) and trading near those levels. Going forward, markets will likely be driven by geopolitical developments. Markets will further be tracking inflation numbers coming out next week. In the short term, 10Y GSEC is expected to move in the 6.70-6.85% range. End
Compiled by Radhika Tiwari
Filed by Himanshi Gupta
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