The Reserve Bank of India’s six-member Monetary Policy Committee began its policy review meeting on Monday, running through October 7. Governor Sanjay Malhotra will announce the decision on Tuesday.

The repo rate stands at 5.25 per cent after four consecutive holds, following cumulative cuts of 125 basis points in 2025. A Reuters poll found 35 of 61 economists expect a 25-basis-point hike to 5.50 per cent, which would be the first increase since February 2023. SBI’s research department also expects the hike cycle to begin pre-emptively.

Retail inflation rose to 4.82 per cent in August, above the RBI’s 4 per cent medium-term target for the third straight month. Brent crude above $100 a barrel, a rupee that has weakened about 6 per cent this year, and rate hikes by major global central banks have strengthened the case for tightening. Markets will also watch the RBI’s growth forecast for any revision following the recent GDP data.