RBI MPC: How mutual fund experts decode rate pause decision for investors
The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI), in its bi-monthly monetary policy review on Friday, decided to keep the repo rate unchanged at 5.25%. The MPC of the central bank also decided to continue with the neutral stance.
Here is how mutual fund managers explain the policy for investors.
InCred Money Team
The stance is neutral but growth supportive. Domestic demand themes such as consumption recovery, GST-led efficiency gains, and public capex remain in focus. Export-oriented and globally exposed sectors warrant closer monitoring as trade volatility persists. A diversified, phased deployment strategy across asset classes remains prudent.
Also Read | RBI MPC outcome: What this rate pause means for mutual fund investors?
Abhishek Bhilwaria, BhilwariaMF, AMFI registered MFD
In 2026, investors should consciously move away from the temptation of chasing high or recent returns and instead focus on building long-term portfolio stability. A well-balanced portfolio with a mix of equity, debt, and gold can help cushion downside risk and deliver smoother returns across market cycles.
Sonam Srivastava, Founder and Fund Manager at Wright Research PMS
For equities, the message is more nuanced. The absence of policy surprise shifts focus back to earnings quality, balance-sheet strength, and pricing power, especially in an environment where global growth remains uneven and capital flows are highly selective.
Overall, the MPC’s decision underscores a transition phase for Indian markets, where monetary policy becomes less of a catalyst and fundamentals reclaim centre stage. Investors are likely to reward consistency, cash-flow visibility, and resilience rather than momentum driven purely by liquidity expectations.
Parijat Agrawal, Head of Fixed Income at Union Asset Management Company
The Monetary Policy Committee maintained the status quo on rates and stance. Projections for growth and inflation have been adjusted marginally upwards. The Reserve Bank will continue to take a proactive and pre-emptive approach to liquidity management. Going ahead, we anticipate RBI’s actions to remain on a pause mode, with further actions being data dependent.
Madhavi Arora, Chief Economist, Emkay Global Financial Services
We believe bond bearishness, driven by a mix of structural, cyclical, and one-off factors, is likely to persist through the rest of FY26, with the 10Y yield hovering in the 6.60-6.75% range. FY27 may see curve flattening, albeit with the balance of risks appearing skewed towards a bear flattening.
Sandeep Yadav, Head of Fixed Income, DSP Mutual Fund
While market yields are marginally higher, this largely reflects a retracement after the sharp rally following yesterday’s OMO cut-offs. Overall, we remain constructive on money markets given RBI’s comfort on liquidity, while duration is likely to trade in a range in the near term before gradually moving lower.
Also Read | Thinking of pausing your mutual fund SIPs? A 6 month gap may cost you Rs 2 lakh additional loss
Basant Bafna, Head, Fixed Income, Mirae Asset Investment Managers (India)
Incremental flows from long-only investor categories, including provident and pension funds, may gradually trickle into the SLR segment over FY2027 as against allocations concentrated towards equity during FY2026, thereby opening up space for yields to trend lower over time.
Here is how mutual fund managers explain the policy for investors.
InCred Money Team
The stance is neutral but growth supportive. Domestic demand themes such as consumption recovery, GST-led efficiency gains, and public capex remain in focus. Export-oriented and globally exposed sectors warrant closer monitoring as trade volatility persists. A diversified, phased deployment strategy across asset classes remains prudent.
Also Read | RBI MPC outcome: What this rate pause means for mutual fund investors?
Abhishek Bhilwaria, BhilwariaMF, AMFI registered MFD
In 2026, investors should consciously move away from the temptation of chasing high or recent returns and instead focus on building long-term portfolio stability. A well-balanced portfolio with a mix of equity, debt, and gold can help cushion downside risk and deliver smoother returns across market cycles.
Sonam Srivastava, Founder and Fund Manager at Wright Research PMS
For equities, the message is more nuanced. The absence of policy surprise shifts focus back to earnings quality, balance-sheet strength, and pricing power, especially in an environment where global growth remains uneven and capital flows are highly selective.
Overall, the MPC’s decision underscores a transition phase for Indian markets, where monetary policy becomes less of a catalyst and fundamentals reclaim centre stage. Investors are likely to reward consistency, cash-flow visibility, and resilience rather than momentum driven purely by liquidity expectations.
Parijat Agrawal, Head of Fixed Income at Union Asset Management Company
The Monetary Policy Committee maintained the status quo on rates and stance. Projections for growth and inflation have been adjusted marginally upwards. The Reserve Bank will continue to take a proactive and pre-emptive approach to liquidity management. Going ahead, we anticipate RBI’s actions to remain on a pause mode, with further actions being data dependent.
Madhavi Arora, Chief Economist, Emkay Global Financial Services
We believe bond bearishness, driven by a mix of structural, cyclical, and one-off factors, is likely to persist through the rest of FY26, with the 10Y yield hovering in the 6.60-6.75% range. FY27 may see curve flattening, albeit with the balance of risks appearing skewed towards a bear flattening.
Sandeep Yadav, Head of Fixed Income, DSP Mutual Fund
While market yields are marginally higher, this largely reflects a retracement after the sharp rally following yesterday’s OMO cut-offs. Overall, we remain constructive on money markets given RBI’s comfort on liquidity, while duration is likely to trade in a range in the near term before gradually moving lower.
Also Read | Thinking of pausing your mutual fund SIPs? A 6 month gap may cost you Rs 2 lakh additional loss
Basant Bafna, Head, Fixed Income, Mirae Asset Investment Managers (India)
Incremental flows from long-only investor categories, including provident and pension funds, may gradually trickle into the SLR segment over FY2027 as against allocations concentrated towards equity during FY2026, thereby opening up space for yields to trend lower over time.
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