By Mr. Ajit Mishra – SVP, Research, Religare Broking Ltd.
“Today’s RBI policy reflects a dual-track strategy of maintaining monetary stability while actively defending the rupee through targeted capital flow incentives. By holding the repo rate steady at 5.25% and retaining a neutral stance, the MPC has prioritised growth and inflation balance, even as it raised FY26 inflation projection to 5.1% and trimmed growth outlook to 6.6%. At the same time, the policy introduces decisive measures to attract foreign capital—scrapping capital gains tax for eligible foreign investors in government bonds, easing FPI access limits, and incentivising NRI dollar deposits while subsidising hedging costs. These steps, combined with concessional forex swaps, are aimed at reversing outflows and stabilising FX markets. For equities and debt markets, this is supportive of liquidity and inflows, while for the rupee, it signals a clear intent to anchor expectations and reduce volatility amid global oil shocks and sustained foreign selling pressure.”