RBI raises repo rate to 5.5% in first hike under Governor Sanjay Malhotra, shifts stance to ‘calibrated tightening’
Economic Times 2 hrs ago·8 Oct 2026, 12:00 am
The Reserve Bank of India lifted its benchmark repo rate by 25 basis points to 5.5%, marking the first increase since February 2023 and signalling a shift to a “calibrated tightening” stance. At the same time, the RBI nudged its FY27 growth outlook up to 7.1% while cautioning that inflation pressures remain a concern.
Higher policy rates raise borrowing costs for businesses and consumers, which can weigh on equity valuations, especially in rate‑sensitive sectors such as real estate, auto and financials. A more optimistic growth forecast may support earnings expectations, but tighter liquidity could also affect the rupee and push bond yields higher.
Investors will be watching the RBI’s next policy review, upcoming inflation data, and global interest‑rate trends for clues on whether further hikes are likely. Corporate earnings reports will help gauge how firms are adapting to the new cost environment.
Excerpt from Economic Times
RBI raises repo rate to 5.5% in first hike under Governor Sanjay Malhotra, shifts stance to ‘calibrated tightening’ RBI raises repo rate to 5.5% in first hike under Governor Sanjay Malhotra, shifts stance to ‘calibrated tightening’ The RBI raised its benchmark repo rate by 25 basis points to 5.5%, its first hike since…Read the original at Economic Times
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