Reserve Bank of India expected to hold policy rate steady

A majority of economists expect the Reserve Bank of India to keep its policy rate unchanged at the June meeting. Geopolitical tensions and adverse weather forecasts are cited as key factors behind the anticipated decision.

Economists polled by The Economic Times predict the central bank will maintain its current stance amid risks to growth and potential inflationary pressures. Geopolitical issues and forecasts of adverse weather conditions are seen as threats that could affect the economy and push up prices for fuel and other goods.

ተያያዥ ጽሁፎች

Banco de la República board unanimously holds interest rate at 11.25% in meeting with Finance Minister amid inflation and political tensions.
በ AI የተሰራ ምስል

Banco de la República unanimously holds interest rate at 11.25%, defying hike expectations amid government tensions

በAI የተዘገበ በ AI የተሰራ ምስል

In its May 1, 2026 board meeting, Banco de la República unanimously kept the benchmark interest rate at 11.25%, surprising analysts expecting a hike to combat accelerating inflation. Finance Minister Germán Ávila participated fully, citing constructive dialogue, while board members justified the decision to maintain stability amid political pressures.

Major banks have revised their forecasts for the Reserve Bank of India after recent softer inflation readings. Standard Chartered Bank has already dropped its call for an August rate increase. Most institutions now anticipate the central bank will stay on hold through FY27.

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The Reserve Bank of India has maintained its policy rate at 5.25 percent with a neutral stance while introducing steps to attract foreign capital.

Banking system liquidity has dropped to its lowest level this fiscal year, pushing up money market rates. Advanced tax outflows triggered the decline. The Reserve Bank of India is offering temporary support through variable rate repo operations.

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A panel has called on the Bank of Japan to proceed carefully with any interest rate increases.

The European Central Bank raised its key interest rate to 2.25 percent on June 11, 2026. It is the first hike since 2023. The ECB also lowered its growth forecast for the eurozone.

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Economy Minister Airlangga Hartarto and Investment Minister Rosan Roeslani urged state-owned banks not to rush in raising lending rates after Bank Indonesia lifted the benchmark rate to 5.75 percent.

 

 

 

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