The Monetary Policy Committee voted unanimously to lift the repo rate by 25 basis points to 5.50 percent and changed its stance to calibrated tightening.
The Reserve Bank of India's Monetary Policy Committee raised the policy repo rate by 25 basis points to 5.50 percent on Wednesday, the first increase since February 2023. The official resolution of the October 5-7 meeting said the six members voted unanimously. Governor Sanjay Malhotra chaired the 63rd meeting.
The standing deposit facility rate was adjusted to 5.25 percent. The marginal standing facility rate and the Bank Rate were set at 5.75 percent. The committee also changed the policy stance to calibrated tightening. CNBC-TV18 reported that the stance vote was 4-2.
The resolution projected real GDP growth for 2026-27 at 7.1 percent, with the second quarter at 7.2 percent, the third at 6.9 percent and the fourth at 6.8 percent. Risks were described as evenly balanced.
CNBC-TV18 quoted Malhotra as saying rate cuts are off the table in the near term and that the next move can only be a hike or a pause. The decision follows months of higher oil prices linked to the Iran war and a rise in global bond yields.
The RBI website listed the governor's statement, the monetary policy resolution and a statement on developmental and regulatory policies as Wednesday releases. A press conference was scheduled for noon India time.
People Sentiments Negative
- Sanjay Malhotra said rate cuts are off the table in the near term.
- CNBC-TV18 reported the stance change to calibrated tightening passed 4-2.