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RBI preparing to hike repo rate after 4 years!
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CNBC Awaaz•06-10-2026, 14:00
RBI preparing to hike repo rate after 4 years!
- •The Reserve Bank of India is likely to hike the repo rate on Wednesday for the first time in nearly four years.
- •Rising inflation, crude oil crossing $100 per barrel, and a weak rupee are the main reasons behind this potential move.
- •The MPC may raise the repo rate by 0.25 percent to 5.50 percent while maintaining a neutral policy stance.
- •Experts estimate a total hike of 0.75 percent could take place by February to manage economic pressures.
- •The bond market is closely monitoring the decision as 10-year government bond yields reach a two-and-a-half-year high.
Key Questions Answered
The RBI is considering raising the repo rate due to accelerating inflation, crude oil prices crossing $100 per barrel, and the Indian rupee nearing record lows.
According to Bloomberg, the MPC may raise the repo rate by 0.25 percent to reach 5.50% while maintaining a neutral policy stance to keep its options open.
To manage the falling rupee and curb excess cash from foreign currency deposits, the RBI has bought and sold dollars, resulting in a record single-week forex decline and the withdrawal of over 1 trillion rupees through bond sales.
