RBI MPC meeting: When and where to watch Sanjay Malhotra & Co's announcements?
The
Reserve Bank of India
's (RBI)
Monetary Policy Committee
(MPC) began its bi-monthly meeting on Wednesday, June 4, 2025 and is set to announce it decision soon.
The six-member panel, chaired by RBI Governor
Sanjay Malhotra
, is evaluating the repo rate, liquidity trends,
inflation outlook
, and growth forecasts.
Market participants widely expect a 25 basis points cut in the repo rate, bringing it down from the current 6% to 5.75%. This would mark the third consecutive rate reduction, aimed at supporting domestic growth amid easing inflation.
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In its last review in April, the MPC had cut the policy rate by 25 basis points.
While most analysts anticipate a 25 basis points cut, the
State Bank of India
has projected a deeper cut of 50 basis points to give a stronger push to economic activity.
Live Events
RBI MPC announcement: Date and time
The outcome of the discussions will be announced on Friday, June 6, at 10:00 AM by Governor Sanjay Malhotra.
RBI MPC: Where to watch?
The announcement will be streamed on RBI's official YouTube channel. Live updates and expert reactions will be available on The Economic Times platform throughout the day.
Catch all live updates
here
.
RBI MPC members: Who are a part of Sanjay Malhotra's team?
The six-member MPC includes three RBI officials: Governor Sanjay Malhotra, Deputy Governor M Rajeshwar Rao, and Executive Director Rajiv Ranjan.
Three external members appointed by the government: Nagesh Kumar, Director-General of the Institute for Studies in Industrial Development; economist Saugata Bhattacharya; and Professor Ram Singh of the Delhi School of Economics.
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Time of India
29 minutes ago
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The Governor's gambit: A double order of a big beautiful cut
Firing a half-percent rate cut off the hip, the new Governor of RBI has signalled that he is not there for half measures. One is reminded of the wisecrack of the street-smart gunslinger immortalised by Eli Wallach in the Good Bad and the Ugly: 'if you want to shoot, shoot, don't talk' though, after firing the double barrel, the Governor also talked for good measure, declaring that one should not equate the projected growth rate with the desired goal and the real goal should be to achieve 8% growth on a sustainable basis! That is a big statement coming from the head of an institution whose one big KRA is inflation management. As if all this was not enough, there was a 1% CRR cut spread across the year to ensure ample liquidity in the market to drive growth. As @SugataGhosh observed sagely in his Economic Times column, only a governor not weighed down by a doctorate in economics could have trodden with such decisiveness in a field where standard operating procedures demand tiptoeing. Among other things, the Governor's gambit opens up an opportunity to undertake a critical review of the conventional, calibrated approach to interest rate adjustments. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 鷲が庭の子犬に近づく - 隣人の次の行動をご覧ください。 「ティップアンドトリック」 Undo Interest rates is an old, oft used tool used by central bankers to manage inflation, but honestly its track record in inflation management has been rather chequered. Arguably, this is because interest rates have two divergent effects on inflation and neither are first-order effects. On one side, a high interest rate will increase the financing costs of businesses who borrow money. This extra cost would eventually find its way into the consumer prices, adding inflationary pressures, though after a lag. At the same time, higher borrowing costs will also slow down the demand for new assets such as homes and cars and investments in new factories, which will cause a general slow-down in demand and thereby moderate inflation through second-order effects. There is a further twist: the relationship between demand and cost of finance is not linear or straightforward; the future inflation expectation of the market has a big role in equation. Change in demand can be viewed as a function of the difference between the present borrowing costs and future inflation expectations. Live Events To use an example, assume the home loan rates have been hiked to, say, 9% from 8.75%. It will have an impact on home demand only if the markets (the collective psyche of the home buyers & sellers) believe that home prices will rise by less than 9% annually henceforth. If buyers believe that home prices will raise by 10% in future, the 9% interest rate will become a mere irritant for the buyers without changing their behaviour. Similarly, if sellers believe the prices will rise by 10%, they will not be too fazed by the 9% financing costs as to offer a price discount. So the interest rate hike (or cut) will work only if it can modify the future inflation outlook of the market. So, the real intent of the interest rate shift is to signal to the collective psyche of the consumers and sellers that Central Bank wants to slow down or speed up things a bit, thereby nudging them to revise their earlier inflation expectations. It is sort of a mind-game, at times it works, at times it doesn't, but a largish one-time rate-shift is much more likely to get people's attention than multiple small changes spread across a number of quarters. No doubts, the ride will be much jerkier under this method compared to the slow, leisurely shifting of gears the markets are accustomed to, but that is exactly the idea. The change should be material enough shake up things a bit so that people will be forced reassess their inflation projections. In short, to be effective, rate changes have to be administered in larger doses within a shorter span. Further, because interest rates influence growth through second order effects, there will always be a lag in transmission and some translation losses as well, both of which can be reduced by front-loading the anticipated changes. The worst-case scenario is that a cut or hike may have to be rolled back partially at a later date. That may sound like an awkward idea at first, but the awkwardness will ease if we can get used to the idea that central bankers are not all-knowing savants, but just a group of learnt heads trying to connect the dots before they have appeared on the screen. Of course, the bond traders and other market intermediaries may certainly frown upon this approach, they hate to be caught on the wrong side of the interest rate curve and hence passionately argue for predictability and smoothness in the rate-shift manoeuvres. While their concerns may not be without merit, the regulator's primary attention should be on achieving the desired effects on the market rather than easing the collateral side-effects on the market-makers. Besides, there may be even a way to balance both the sides as RBI themselves have shown in the CRR reduction approach. Perhaps next time RBI can announce a 75 percent rate cut or hike upfront to be rolled out over a 6 months period. This will also obviate the need for RBI to disclose their policy stance as accommodative, neutral, hawkish, dovish etc. The stance will become embedded in the rate and hence implicit. 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Time of India
30 minutes ago
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RBI's bold rate cut sets stage for market rally: Sandip Sabharwal
"I think most of the MFI-focused companies are trading at somewhat distressed valuations. And there were two comments, specifically, one that the RBI has clearly stated that they see easing stress on the unsecured loan book, so that is overall good for the financial sector, especially for NBFC and more specifically for MFIs," says Sandip Sabharwal , Where you see the markets headed today, the kind of fillip that we have seen on the Nifty on Friday, do you believe that is sustainable today and the sectors that have been leading over the course of last week, do you believe they will continue to lead this week as well? Sandip Sabharwal: Yes, I think so, because the RBI's actions were quite significant. And in fact, many other sectors like auto would also have participated much more, because they are very strong beneficiaries of the easing equity and rate cut cycle, but for the rare magnets issue. 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Economic Times
33 minutes ago
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RBI's bold rate cut sets stage for market rally: Sandip Sabharwal
"I think most of the MFI-focused companies are trading at somewhat distressed valuations. And there were two comments, specifically, one that the RBI has clearly stated that they see easing stress on the unsecured loan book, so that is overall good for the financial sector, especially for NBFC and more specifically for MFIs," says Sandip Sabharwal, ADVERTISEMENT Where you see the markets headed today, the kind of fillip that we have seen on the Nifty on Friday, do you believe that is sustainable today and the sectors that have been leading over the course of last week, do you believe they will continue to lead this week as well? Sandip Sabharwal: Yes, I think so, because the RBI's actions were quite significant. And in fact, many other sectors like auto would also have participated much more, because they are very strong beneficiaries of the easing equity and rate cut cycle, but for the rare magnets issue. Otherwise, the autos would have done much better than what they did on Friday. 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And there were two comments, specifically, one that the RBI has clearly stated that they see easing stress on the unsecured loan book, so that is overall good for the financial sector, especially for NBFC and more specifically for MFIs, although there would be some concerns related to some state government bringing out new laws, etc, where some specific company could get impacted, so that has to be more minutely analysed. But that comment combined with the fact that MFI lenders have the ability to diversify into other segments and still retain the MFI categorisation, I think that is a significant positive, because then risk can be maintained better in the balance sheet. So, overall, it is quite positive for the MFI sector, even for the gold lenders where the norms have been eased. So, something has been given to everyone. If you can just highlight some of your top favourites within the financial space. Well, of course, it is not just the MFIs, the gold financers, it is actually great news for many of these stocks, but which are your top bets within the financial space? Sandip Sabharwal: The larger bank can continue to do well, which include ICICI, HDFC, Axis, Kotak, etc. Some of the PSU banks could see a revival. So, because of the sheer underperformance, we have actually recently added into SBI also in our portfolios. ADVERTISEMENT The other part which could benefit, obviously the NBFCs benefit much more in a significant easing cycle than the banks, so NBFCs people have a wide choice like Manappuram, L&T Finance, Mahindra Financial, Bajaj Finance, etc, among the NBFCs. But then there are others also which could benefit. So, investors have a wide choice. But overall, for the NBFC sector, this what RBI has been doing over the last few months is a much more significant positive than banks per se because most large banks have 40-45% CASA deposits where the costing does not reduce so much immediately and it is more or less fixed, although most banks have cut rates by 25 basis points, but for NBFCs which tend to be bulk borrows, significant monetary easing is much more positive. ADVERTISEMENT The realty pack, where is it that you find comfort to buy a fresh or add-in or even some of the HFCs, for instance, maybe that is a better play. Sandip Sabharwal: I like diversified NBFCs better. So, I would focus on those because only focused housing finance companies will continue to face more and more margin pressures as the liquidity eases. So, it is better to be in the diversified space. On the real estate sector, obviously this benefits the real estate sector. But as of now, I am not finding comfort in buying into any of these real estate companies at these valuations because the run-ups in most in the near term has been very substantial be it the market leader something like DLF already valued from 600 odd to 850, 880 something, so the rallies over the last one or two months in most of the real estate counter has been so significant. It is tough to find value. But on correction, we could still evaluate. ADVERTISEMENT Where both the companies will actually see what they can do best. But it is a big issue that is now emerging for the auto companies specifically with the shortage of critical rare earth magnets rather coming in from China. What is your sense that how severe this could actually impact the Indian auto industry and other sectors as well, given the fact we have a lot of reliability on China when it comes to select magnets? Sandip Sabharwal: So, there is a lot of news to go on where the impacts could be. The direct impact is more on the auto side immediately but apparently be going to a electronics, etc. So, now it will depend on how fast. So, it is not a question of supply. The supply is there, the supply is not being given, so that is the issue. So, whether it will get resolved or not, we do not know. Overnight there has been some news flow that China has approved supplies to some European and US customers. So, the point is, is India going to be singled out or is this issue going to be resolved? So, there are too many moving pieces. So, we need to watch out for that. EVs apparently will be much more impacted. So, to that extent, companies which have bigger EV portfolio or greater reliance on EVs only or two-wheeler EV companies, etc, those might be impacted more if it does not get resolved over the next four to six months. ADVERTISEMENT
