Mumbai: The Reserve Bank of India released on Wednesday the minutes of the Monetary Policy Committee (MPC) meeting held from October 5 to 7. The panel voted unanimously to raise the policy repo rate by 25 basis points to 5.50%, the first hike in nearly four years.
The committee changed its stance to calibrated tightening. RBI Governor Sanjay Malhotra said this essentially signalled that rate cuts were off the table in the near term, and that policy action ahead could only be a rate hike or a pause.
Consumer price inflation rose to 4.8% in August from 4.5% in July, while core inflation increased to 4.2%. According to the governor, the share of items in the CPI basket recording inflation above 4% rose to about 37% in August from 20% in March.
The MPC raised its retail inflation projection for 2026-27 to 5.2% from 5%. It expects inflation to touch 6%, the upper end of the tolerance band, in the third quarter before easing. Real GDP growth for 2026-27 is projected at 7.1%. All six members backed the rate increase, but Nagesh Kumar and Ram Singh opposed the change in stance from neutral. The next MPC meeting is scheduled for December 2 to 4.