Several major banks have revised their policy rate hike forecasts following the Reserve Bank of India's decision to keep the repo rate unchanged at 5.25% for the fourth consecutive time. Yes Bank and State Bank of India are among the market participants that have lowered their expectations of a policy-rate increase in the foreseeable future after the RBI sounded relatively dovish on inflation. According to reports from The Economic Times, Yes Bank, which had earlier expected hikes in October or December, now believes the RBI will defer raising rates for as long as possible, while SBI said the latest policy pushes any rate hikes beyond FY27. The latest developments show that MUFG Bank has moved its first hike call from October to December, while Goldman Sachs expects 25 bps hikes in December and February. ICICI Bank has pushed its first hike call to April, and HDFC Bank moved its call to February.
Following the RBI's decision to keep rates unchanged, five major banks have revised their FD rates effective from August 2026. Union Bank of India offers rates ranging from 6.00% to 6.55% for various tenures, with additional benefits of 0.50% to 0.75% for senior citizens on deposits up to ₹5 crore. Indian Bank provides rates between 5.50% to 6.00% for different tenures, with callable interest rates for deposits above ₹3 crore. CSB Bank offers rates from 5.00% to 7.10% across various tenures, while DCB Bank provides competitive rates from 6.90% to 8.00%. Jana Small Finance Bank offers rates from 6.50% to 8.00% for different tenures, with the highest rates available for longer-term deposits.
The RBI's dovish pause has provided immediate relief to home loan borrowers, as economists have pushed fresh 25 bps rate hike calls beyond the October policy cycle. As reported by LoansJagat, borrowers whose EMI is linked to floating benchmarks may not see a sudden rise right away, though the long-term risk remains open if food prices, fuel costs or global oil pressure stay high. The relief is particularly significant for borrowers in cities such as Mumbai, Bengaluru, Pune, Hyderabad, Delhi NCR and Chennai, where loan sizes often take a large part of monthly income. Banks will continue watching the same data before pricing fresh loans, and existing borrowers should check their benchmark rate, loan spread and reset date before the next policy review.
The RBI has projected Q4FY27 inflation at 5.5% in its August policy, up from 5.4% in its earlier projection. According to The Economic Times, for the full FY27, the Reserve Bank of India has projected inflation at 5%, down from 5.1% previously. In Q1FY28, inflation is expected at 5.3%. The latest government data shows retail inflation at 4.38% and food inflation at 5.32% as per the Press Information Bureau's June 2026 CPI data released on July 13, 2026. The RBI has assumed an average crude oil price of $95 per barrel for FY27 in its inflation projections, with inflation in India being highly sensitive to crude oil prices given the country's status as a net importer of the commodity.
