Overview

• The Monetary Policy Committee kept the repo rate at 5.50% and maintained a neutral stance at its Sep 19–Oct 1 meeting, according to minutes released Oct 15.
• Headline CPI fell to an eight-year low of 1.54% in September, prompting the RBI to cut its FY26 inflation forecast to 2.6%, which creates policy space for future easing.
• The RBI raised its FY26 GDP growth projection to 6.8% but warned growth could soften in the second half due to U.S. tariffs and broader external risks.
• External members Nagesh Kumar and Ram Singh backed holding the rate but favored shifting the stance to accommodative to signal readiness to cut if needed.
• Officials emphasized waiting for transmission of this year’s 100 bps of cuts and recent fiscal measures, with many economists expecting 25–50 bps of easing later in the year depending on tariff developments and data ahead of the Dec 3–5 meeting.