No more RBI Rate Cuts Ahead? Here’s What Reserve Bank of India’s Surprise Bonanza Signals for Investors

Rbi monetary policy: In Its June Monetary Policy Meeting, The Reserve Bank of India (RBI) Front-loaded rate cuts with a 50 basis points reduction, supported by benign information. This move has been to expectations that the current rate cut Cycle may have come to an end – at least for now.

RBI Governor Sanjay Malhotra’s Shift in Policy Stance from ‘Accommodative’ to ‘Neutral’, Along with his statement that the Monetary Policy Committee (MPC) will not do carefully comes Evolving Economic Outlook Before Deciding on Further Action, also Signals a Possible Pause in Rate Cuts. In another liquidity booster, Malhotra Announced A 100 BPS CRR Cut Bonanza.

“The RBI Surprised on Three Fronts: With A 50 BPS Cut, CRR CUT of 100 BPS (Between September to November), and a Stance Change Back to Neutral. Now shifts to quick and maximum passmission of the 100 BPS REPO RATE CUTS Till Now, “Said Suvodeep Rakshit, Chief Economist, Kotak Institutional Equities.

He believes that RBI’s Future Policy will be dependent on domestic growth-inflation outturns. “We do not expect further rate cuts over the next few policies while watching for the evolution of global growth and dietic inflation risks,” Rakshit Added.

Echoing Similar views, Market Veteran and Geojit Investment’s Chief Investment Strategist Dr VK Vijayakumar said this big rate cut is, as the RBI GOVERNONOR REMARKED, A. FORNT-Olding of the Rate Cut. The change in monetary stance from Accommodative to Neutral also indicates

However, Sujan Hazra, Chief Economist & Executive Director of Anand Rathi Group, Said That While This Change Might Be Read As A Signal That Rate Cut Cycle Is Nearing Its End, We BELIEVEVE IS AIMED At temporing any potential “Irrational exuberance” in the financial markets.

The street was widely anticipating a 25 bps rate reduction by the RBI MPC as against a 50 bps cut to 5.50%. This not only marked the third straight rbi rate cut so far in 2025, but also took the effective rate cut to 100 bps. Against this Backdrop, Governor Malhotra said, “After Reducing Repo by 100 BPS in Quick Succession, The Monetary Policy is Left with Limited Space to Support to Support Growth.”

However, Gautam Duggad, Head of Research, Institutional Equites, Motilal Oswal Financial Services, Believes That a Benign Influence Outlook Coupled With a Challenge Groveth Outlook Amid Trde Policy Uncertainty and geopolitical tensions provides Room for more rate cuts. Against this backdrop, he anticipates two more rates of 25bps each in fy26 to support growth.

RBI Rate Cut Impact for Investors

Decoding the impact of the rate cut on investors, hazra said the policy decision is constructive for both equity and debt markets. In equities, interest-sensitive sectors are poised to benefits. While Lower Rates and Policy Transmission Could have Weighed on Bank Net Interest Margins in the Near Term, The sizeable CRR Cut Provides a Significant Offset, Making this A Particive Movie For Banks, Hazra said.

Swapnil Aggarwal, Director vsrk Capital, Believes The Rate Reduction Move Cold Spark a Shift from Fixed Deposits to the Capital Markets, Why Bodes Bodes Bodes Bodes Well for Bothe Mutual Funds, Indin and debt instruments.

“The Reduction in Interest Rate will impact return Funds, debt instruments and other market-linked products.

The impact of the RBI’s Bazooka was already visible in the Indian Stock Market, with Rate-sensitive sector like banks, auto and realty leading the charge.

The BSE Sensex Surged over 800 points in intraday deals to the 82,300 legs nse counterpart nifty 50 Topped the 25,000 mark today, LED by a rally in hdfc bank, bajaj twins, maruti Suzuki and M & M.

Disclaimer: This story is for educational purposes only. The views and recommendations made Above are that of individual analysts or broking companies, and not of mint. We Advise Investors to Check With Certified Experts Before Making Any Investments Decisions.