Stock Market Today: Reaction to RBI Policy Decision On Repo Rate
From the trader’s seat, Friday delivered two familiar events as the Reserve Bank of India announced its rate decision, triggering a market reaction that lacked enthusiasm. The Monetary Policy Committee decided to keep the repo rate unchanged at 5.25% while maintaining its neutral stance, prompting a cautious response from market participants, even as Governor Sanjay Malhotra expressed confidence in India’s economic strength. Benchmark indices slipped to their day’s lows after the announcement, before settling around 0.3% lower.
The Sensex touched an intraday low of 82,945.56 after falling 368 points, marking a 0.44% decline. The Nifty 50 dropped 136 points, or 0.53%, to 25,504.6. In contrast, Bank Nifty moved in the opposite direction, rising 0.55%, signalling selective buying rather than broad-based selling.
For traders, the message was straightforward: there were no surprises, as interest rates remained unchanged. The session called for reading market reactions carefully, tracking sector rotation, and letting policy commentary, not just the headline, guide the next move.
Stock Market Today: Movements After RBI Meeting
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Sensex fell 368 points (0.44%) to an intraday low of 82,945.56
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Nifty 50 dropped 136 points (0.53%) to 25,504.6
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Bank Nifty outperformed, trading 0.55% higher
Stock Market Sectoral Performance
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Rate-sensitive sectors largely under pressure
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Nifty Bank: down -0.3%
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Nifty Financial Services: down -0.3%
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Nifty Auto: declined over 1%
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Nifty Realty: traded flat
Why Did Stock Market React Sharply? RBI Policy Outcome and Outlook – February 6, 2026
1. Repo Rate Decision
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The RBI Monetary Policy Committee (MPC) kept the policy repo rate unchanged at 5.25%.
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This continues the pause after cumulative 125 bps cuts since February 2025, including a 25 bps reduction in December 2025.
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The pause reflects a cautious approach, giving time for previous rate cuts to transmit through the economy.
2. Governor’s Commentary
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Governor Sanjay Malhotra emphasized that India’s domestic fundamentals remain strong.
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Despite global uncertainties, the economy is resilient, justifying a neutral stance.
3. Future Policy Guidance
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The MPC will be guided by evolving macroeconomic conditions.
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Decisions will consider the new GDP and inflation series, which are expected shortly.
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The RBI continues a measured approach, balancing growth support with inflation vigilance.
4. Inflation Outlook
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CPI inflation projected at 2.1% for FY26, indicating a stable and comfortable environment.
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Inflation pressures are manageable, reducing the need for immediate rate changes.
5. Growth Projections
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FY26 GDP forecast marginally raised to 7.4%, reflecting robust economic momentum.
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Strong domestic consumption, investment activity, and policy support underpin the growth outlook.
6. Overall Policy Tone
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Policy stance described as neutral and cautious.
(With Inputs From ANI)
Also Read: RBI Policy Meeting: Governor Sanjay Malhotra Keeps Repo Rate Unchanged At 5.25%,