Fresh deposit and lending rates have hardened in recent months with the rising credit demand, according to RBI’s latest monthly bulletin.The weighted average domestic term deposit rate (WADTDR) on fresh deposits rose by 16 basis points (bps) in June 2026 against a 4 bps increase in May 2026. One basis point is equal to 0.01 per cent.The weighted average lending rate (WALR) on fresh Rupee loans increased by 2 bps in June 2026 against a 1 bp increase in May 2026, according data in the bulletin.However, the one-year marginal cost of funds-based lending rate (MCLR) declined by 15 bps in June 2026 against an increase of 10 bps in May 2026.Credit growthIn his last monetary policy statement, RBI Governor Sanjay Malhotra observed that the transmission (of the cumulative 125 basis points repo rate cuts during the current easing cycle: February 2026 to June 2026 period) in the credit market moderated during May-June with hardening of deposit and lending rates. Nevertheless, credit growth continues to remain robust and broad-based across sectors.Scheduled Commercial Banks’ credit and deposit growth stood at 19.3 per cent y-o-y and 15.4 per cent y-o-y, respectively, as on July 31, 2026, compared to 18.6 per cent y-o-y and 13.3 per cent y-o-y, respectively, as on June 30, 2026.Sector-wise data indicates buoyant credit flows to retail and services sector. Industrial credit strengthened further, aided by sustained credit growth in MSMEs and pickup in credit to large industries. Agricultural credit grew at a steady pace.Across bank groups, private sector banks recorded stronger pass-through to lending rates than public sector banks, while later exhibited relatively higher transmission to deposit rates during the current easing cycle, RBI officials said in the “State of the Economy” report in the bulletin.Published on August 25, 2026