Indian Bank Stocks Rise as RBI Rate-Hike Bets Build Ahead of Wednesday Meeting

Investing.com·6 Oct 2026·Read original

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Indian bank stocks rose on Tuesday, led by a 1.1% jump in the Nifty Private Bank index, as investors positioned for a potential Reserve Bank of India rate hike this week amid signs that inflationary pressures are broadening. Kotak Mahindra Bank was the strongest gainer among the major lenders shown, rising 3.77% to 431.70 rupees, while Axis Bank gained 1.15% to 1,236.20 rupees, HDFC Bank rose 0.72% to 709.90 rupees and ICICI Bank gained 0.17% to 1,334.20 rupees. Markets have increasingly priced in a rate increase at the RBI's monetary policy meeting on Wednesday, with nearly 60% of economists polled by Reuters expecting a 25-basis-point hike that would be the RBI's first increase in almost four years and take the benchmark repo rate to 5.50% from 5.25%, while swap markets are fully pricing a hike and implying about 100 basis points of increases over the next 12 months. Consumer inflation accelerated to 4.82% in August, remaining above the RBI's 4% medium-term target for a third consecutive month, while the economy grew 7.8% in the April-June quarter. Public-sector lenders also advanced, with Indian Bank up 0.43%, Bank of Baroda up 0.50%, Union Bank of India up 0.57%, Punjab National Bank up 0.26% and Canara Bank up 0.17%.