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RBI MPC Meeting Begins Today: Will Repo Rate Increase? Impact on Loans and FDs
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News18•05-10-2026, 08:10
RBI MPC Meeting Begins Today: Will Repo Rate Increase? Impact on Loans and FDs
- •The Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) meeting starts today, October 5, to discuss inflation, economic growth, and financial conditions.
- •Discussions about an interest rate hike are intensifying due to rising inflation, crude oil above $100, and a weakening rupee.
- •A Reuters survey indicates about 60% of economists predict a 0.25% increase, potentially raising the repo rate to 5.50%.
- •SBI Research and Nomura expect the RBI to increase the repo rate by 25-25 basis points, potentially reaching 5.75% by December.
- •A repo rate increase could lead to higher EMIs for home, car, and personal loans, while also potentially increasing FD interest rates.
Key Questions Answered
Rising inflation, crude oil prices staying above $100, a weakening rupee, and deteriorating global conditions are driving expectations that the RBI might increase the repo rate.
If the RBI raises the repo rate, borrowing costs for banks will increase, and they may pass this financial burden on to customers, leading to higher interest rates and EMIs for home, car, and personal loans.
To attract more deposits in a tightening rate environment, banks might increase FD interest rates, which could potentially offer investors higher returns on their savings.
