RBI raises repo rate to 5.5% Calibrated tightening

Oct 7

DD India links the renewed West Asian conflict, volatile crude prices and inflation risks to the RBI Monetary Policy Committee's unanimous 25-basis-point increase of the repo rate to 5.50 percent and shift to calibrated tightening. Shama Mishra's full report carries Governor Sanjay Malhotra's decision and growth projections. It reports FY2026–27 CPI inflation projected at 5.2 percent, GDP growth raised by 40 basis points to 7.1 percent and first-quarter growth of 7.8 percent. It retains monsoon, El Niño, commodity, geopolitical and trade risks alongside domestic-consumption, investment and services strengths, roughly eleven months of import-cover reserves and April–August FDI figures of $13.8 billion versus $9.6 billion. Mahendra Kumar Chouhan says these strengths can absorb tightening but urges a measured approach to sustain investment. Further policy remains dependent on the evolving outlook; forecasts are not outcomes.

The RBI MPC unanimously raises the repo rate by 25 basis points to 5.50 percent and shifts to calibrated tightening. DD India links the decision to renewed West Asian conflict, volatile crude and inflation risks, reports FY2026–27 inflation projected at 5.2 percent and growth revised to 7.1 percent, and carries Malhotra's announcement and Chouhan's qualified industry response. Further action depends on the evolving outlook; forecasts remain forecasts.