RBI may deliver another 25 bps rate punch in December despite moderating food prices
Economic Times 4 hrs ago·14 Oct 2026, 12:30 am
The Reserve Bank of India (RBI) is widely expected to maintain its tight monetary policy stance in December. Despite a recent easing in vegetable and sugar prices, the central bank is likely to hold the repo rate steady at 6.5%. This decision is driven by the fact that inflationary pressures are not yet fully under control.
This move matters for investors as it signals that the RBI is prioritizing price stability over immediate economic growth. A pause in rate hikes suggests the central bank wants to see if the recent moderation in food prices is sustained before making further adjustments.
Investors should watch for the central bank's commentary on the 'delayed pass-through' of costs. This factor is crucial because it indicates that underlying inflationary pressures remain, which could keep the RBI cautious about cutting rates in the near future.
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