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RBI Raises FY27 Inflation Forecast to 5.2 Percent and Hikes Repo Rate
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CNBC TV18•07-10-2026, 10:54
RBI Raises FY27 Inflation Forecast to 5.2 Percent and Hikes Repo Rate
- •The Reserve Bank of India raised its FY27 consumer price inflation forecast to 5.2 percent from the previous 5 percent.
- •RBI Governor Sanjay Malhotra announced a 25 basis point hike in the policy repo rate, bringing it to 5.5 percent.
- •The central bank shifted its policy stance to calibrated tightening following a 4:2 majority decision by the Monetary Policy Committee.
- •The FY27 GDP growth projection was increased by 40 basis points to 7.1 percent.
- •Near-term inflation continues to face supply-side pressures from deficient monsoons, El Nino, and oil price volatility.
Key Questions Answered
The Reserve Bank of India raised its FY27 Consumer Price Index (CPI) inflation forecast to 5.2% from 5% and projected the three-quarter average inflation at 5.8%. Additionally, the RBI raised its FY27 GDP growth projection by 40 basis points to 7.1% from the earlier 6.7% forecast.
Governor Sanjay Malhotra announced a 25 basis point hike in the policy repo rate to 5.5% following a 4:2 majority decision by the MPC, ending a prolonged pause. The central bank also shifted its policy stance to calibrated tightening.
The near-term inflation outlook points to ongoing supply-side pressures driven by a deficient monsoon, El Niño conditions, and volatility in global oil prices. Retail inflation previously reached a 22-month high of 4.82% in August.
