RBI Holds Rates Steady, Signals Accommodative Stance for H2 2026

The Reserve Bank of India's Monetary Policy Committee (MPC) voted unanimously to keep the repo rate unchanged at 6.25% in its June 2026 bi-monthly review, but in a significant shift, changed its policy stance from "neutral" to "accommodative."

RBI Governor Shaktikanta Das explained that while inflation remains within the target band at 4.2%, the MPC wants to see sustained moderation before initiating rate cuts. "The change in stance is a clear signal of the direction of our future actions," he said.

The central bank retained its GDP growth forecast for FY2027 at 6.8%, citing robust domestic demand, strong services sector performance, and improving global trade conditions. However, it flagged risks from geopolitical tensions and commodity price volatility.

Bond markets reacted positively, with the benchmark 10-year government bond yield falling 8 basis points to 6.72%. Banking stocks also gained, with the Nifty Bank index rising 1.2% following the announcement.