Bank of America Securities has sharply raised its forecast for Reserve Bank of India rate hikes, now expecting a cumulative 100 basis points of increases through the first half of 2027. In its India Viewpoint report released September 30, the brokerage pulled forward its call for the first hike to the October 7 monetary policy meeting — a 25-basis-point move.

BofA had earlier forecast just 50 basis points of tightening. “Our bigger forecast shift is arguably the quantum of hikes, as we are raising our total quantum of hikes from 50bp earlier, to 100bp now,” the report said, taking the projected terminal repo rate to 6.25%. It expects 50 basis points of hikes in Q4 2026 and another 50 in H1 2027, with the stance switching to “calibrated tightening” in December.

The brokerage argues the RBI has less reason to wait: growth remains resilient, with non-food credit growth at 17.8% year-on-year in September, while inflation risks are broadening — oil held $100-110 a barrel through most of September, food inflation is spreading, and tradables inflation hit 5.9% in August 2026.