Avnish Jain, Chief Investment Officer – Fixed Income, Canara Robeco Asset Management Company Limited
“The RBI Monetary Policy Committee (RBI MPC) cut repo rate by 25 bps whilst continuing with a neutral stance. While markets have been expecting RBI MPC to cut rates in December policy meet, Q2 GDP numbers printing 8.2% and weaker rupee led to some market participants expecting RBI MPC to pause and adopt a wait and watch approach. However, RBI MPC not only cut repo rate but also announced liquidity measures which includes OMO (Open Market Operations) purchase of government securities to the tune of Rs.1 lac crore and USD 5 billion WORTH of 3Y BUY/SELL swap (~Rs.45000cr of liquidity), which is likely to add durable liquidity to the system. RBI now projects FY2026 CPI inflation at 2% whilst growth projections are raised to 7.3%. For 1 HFY2027, RBI has projected a CPI inflation of 4% and thus maintained a neutral stance. Overall, it was a positive surprise on liquidity actions as well as dovish nature of policy.
Going forward, markets will look at upcoming US FED (Federal Reserve) policy, wherein a rate cut is further expected. Overall market sentiment seems to have turned positive and we may see yields trending lower in near term. Movement of USD/INR may continue to be watched by the market. Further, rate easing may depend on factors like completion of US-India trade policy, US FED actions, and currency movements. In the near term 10Y may move in 6.40%-6.50% range, with a downward bias”
Mr. Rishi Anand, MD & CEO, Aadhar Housing Finance
“The RBI’s decision to reduce the repo rate by 25 bps brings the total reduction this year to 125 bps, marking the fourth rate cut in 2025 and reflecting its continued focus on supporting economic growth along with improving liquidity. This cumulative rate cut has and will bring favourable relief to borrowers, especially first-time homebuyers in the affordable housing category, as a reduction in rates cuts down their EMI burden and opens up further avenues towards homeownership.
For EWS and LIG customers, even a small rate reduction can make homeownership more accessible and boost their confidence to take the step towards owning a home. With strong demand emerging from Tier 2 and Tier 3 cities and continued government support through schemes like PMAY, the environment remains highly favourable for affordable homebuyers. This will further energise the segment and help more families move closer to securing their first home.”
Ashish Goyal, Co-Founder and Whole Time Director, Fibe (a series E funded digital lending platform)
“The 25 bps rate cut announced today, taking the total reduction to 125 bps in 2025, signals a strong shift toward supporting growth while keeping inflation in check. The cumulative easing brings down borrowing costs meaningfully, strengthens household purchasing power and gives customers more confidence to plan long-term. Lower rates also create a clear push for higher consumption as everyday credit becomes more accessible and the cost of major purchases becomes easier to manage.”
Meanwhile, the liquidity actions through large government bond purchases and the three-year dollar rupee swap focus on strengthening the financial system itself. Injecting more than ₹1 lakh crore into the economy ensures lenders have the flexibility to extend credit smoothly and prevents any strain on financial conditions. Better liquidity also improves policy transmission, supports small enterprises and stabilises financial markets. Combined with the RBI’s renewed push on customer service and grievance resolution, these steps create a more resilient and customer-centric financial environment that supports broad-based economic momentum.”