On 7 October 2026, the RBI Monetary Policy Committee (MPC) unanimously raised the repo rate by 25 basis points to 5.50%, marking the first rate hike in four years. The policy stance was changed to “calibrated tightening” to contain rising inflationary pressures.
Key Points:
- Repo Rate: 5.25% → 5.50%
- SDF: 5.25%
- MSF & Bank Rate: 5.75%
- CPI inflation: Projected at 5.8% over the next three quarters.
- Core inflation: Expected at 4.4% in FY 2026–27.
- Q1 FY 2026–27 GDP growth: 7.8%
- Inflation risks were linked to higher crude oil prices, food costs and supply-chain pressures.
- Strong domestic consumption, investment and services exports supported economic growth.
- Global risks included West Asia tensions, high bond yields and financial-market volatility.
