The Reserve Bank of India may raise interest rates more than most expect on October 7. Swap market pricing shows a real chance of a 50 basis point hike, not just the expected 25 basis points. The RBI’s monetary policy committee announces its decision on Wednesday. Most economists expect a 25 basis point increase in the repo rate to 5.50 percent. It would be the first rate hike since February 2023. The repo rate has stayed at 5.25 percent for four straight policy meetings. The one-month overnight indexed swap rate is quoting near 5.55 percent. That is about 30 basis points above the current repo rate. Bankers say this means a 25 basis point hike is fully priced in, with a modest chance of 50 basis points. A Reuters poll found 35 of 61 economists expect a 25 basis point hike. Five bankers who study swap pricing see the risk of a larger move. Retail inflation rose to 4.82 percent in August. It has stayed above the RBI target of 4 percent for three straight months. Brent crude is trading above 100 dollars a barrel. The US Federal Reserve and the European Central Bank both raised rates in September.