RBI repo rate likely to climb to 6% in FY27; G-Sec yields face upward pressure
BusinessLine 1 hr ago·4 Oct 2026, 3:54 am
The Reserve Bank of India is expected to raise its policy repo rate to about 6% in the fiscal year 2027, signalling a shift from the relatively accommodative stance it has kept over the past year.
A higher repo rate typically lifts yields on government securities, making fixed‑income assets more attractive and increasing the discount rate used to value equities. This can weigh on stock prices, especially in sectors such as real estate, utilities and auto that are sensitive to borrowing costs.
Investors should keep an eye on the RBI’s next policy announcement, upcoming inflation data, and any guidance on the cash reserve ratio, as well as global interest‑rate trends that could affect capital flows into Indian markets.
Excerpt from BusinessLine
New Delhi The Reserve Bank of India (RBI) is expected to raise the repo rate by 25 basis points in October, with further hikes likely in FY27 as inflation risks persist, potentially pushing the benchmark rate to 5.75–6 per cent, pressuring G-sec yields, as per a report by Union Bank of India. The lender noted in its…Read the original at BusinessLine
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