Overview

• Policymakers cut their FY26 CPI projection to 2.6% and lifted GDP growth to 6.8% after September inflation fell to an eight-year low of 1.54%.
• Two external members backed shifting the stance to accommodative, while others warned a further cut now risks an overdose with 100 bps of easing still filtering through.
• Members cited U.S. tariff actions and related policy steps as key external headwinds, with GST rationalisation expected to partially cushion the impact.
• Governor Sanjay Malhotra said policy space exists but the timing is not opportune, and he later downplayed tariff risks in Washington, noting India’s domestic demand resilience.
• The next MPC meeting on Dec. 3–5 will reassess incoming data and external developments, with some economists projecting the possibility of a small cut.