RBI MPC Meet: No Rate Cut Expected, Focus on Liquidity Management

• The RBI's Monetary Policy Committee (MPC) meeting is scheduled from February 4 to 6.
• Economists do not anticipate an interest rate cut in the upcoming meeting, despite previous cuts totaling 125 basis points since February 2025.
• The central bank is expected to focus on managing liquidity, ensuring bond market stability, and addressing currency-related risks.
• DBS Bank's Radhika Rao suggests the RBI may continue bond purchases to control borrowing costs, especially with record government borrowing indicated in the FY 2027 budget.
• The RBI recently injected over 2 lakh crore rupees into the banking system through various measures to boost liquidity.

Why It Matters: RBI's MPC is unlikely to cut rates, prioritizing liquidity management and bond market stability.