RBI
RBI Hikes Repo Rate 25 bps to 5.5%, Shifts Stance to 'Calibrated Tightening'
7 October 2026 · www.ndtvprofit.com
The RBI MPC unanimously raised the repo rate by 25 bps to 5.5%—the first hike in over three-and-a-half years—ending nearly two years of monetary accommodation. The stance was changed to 'calibrated tightening', with future action restricted to hikes or an extended pause, as retail inflation stayed above the 4% target.
Points to Remember
- Repo rate raised 25 bps to 5.5%; Standing Deposit Facility at 5.25%; MSF and Bank Rate at 5.75%.
- Policy stance changed to 'calibrated tightening'; rate cuts ruled out in the near term.
- FY27 real GDP growth forecast raised to 7.1% (up 40 bps); quarterly path 7.2% (Q2), 6.9% (Q3), 6.8% (Q4).
- FY27 CPI inflation projected at 5.2% average; Q2 4.9%, Q3 6.0%, Q4 5.7%; core inflation FY27 seen at 4.4%.
- New measures: interoperability among NBFC account aggregators by end-December and a Technical Consultative Committee for Financial Markets.
Why it matters
EMIs on repo-linked home and car loans are set to rise, so customers may ask about higher repayments; deposit rates could also move up over time. The inflation and growth projections are useful when discussing rate-sensitive products.
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