RBI may hike repo rate by 75-100 bps in current cycle as inflation persists- SBI Capital flags December hike risk
Mint 2 hrs ago·10 Oct 2026, 1:07 pm
The Reserve Bank of India (RBI) is widely expected to raise its key lending rate, known as the repo rate, by 75 to 100 basis points in the current cycle. This move is driven by persistent inflation, which remains a concern for the economy. A repo rate hike makes borrowing more expensive for banks and financial institutions, which can eventually lead to higher interest rates for consumers and businesses.
For investors, this development signals a shift towards a tighter monetary policy. Higher interest rates can dampen economic growth by reducing consumer spending and business investment. While this helps control inflation, it may also impact the profitability of sectors that are sensitive to interest rates, such as banking and real estate.
Investors should closely monitor the RBI's future policy announcements and inflation data. The market will be watching to see if the central bank signals a pause in rate hikes or if further increases are anticipated. Understanding the central bank's stance is crucial for making informed investment decisions in the current economic environment.
Excerpt from Mint
SBI Capital said gradual rate increases remain the most likely scenario, although a larger hike in December 2026 cannot be ruled out The Reserve Bank of India (RBI) may raise the repo rate by 75-100 basis points during the current monetary tightening cycle, as inflationary pressures are expected to persist before…Read the original at Mint
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