RBI Monetary Policy Committee Begins Three-Day Meeting; Repo Rate Decision Due October 7
Mumbai, October 5, 2026: The Reserve Bank of India's Monetary Policy Committee (MPC) begins its three-day meeting today, October 5 to 7. Governor Sanjay Malhotra is expected to announce the policy decision on Wednesday, October 7. This is the fourth MPC meeting of the financial year 2026–27.
Where Policy Stands
At its August 3–5 meeting, the MPC:
- Kept the repo rate unchanged at 5.25% for the fourth consecutive review
- Retained a neutral policy stance, with a unanimous vote
- Raised its FY27 GDP growth forecast to 6.7% from 6.6%
- Lowered its FY27 CPI inflation projection to 5.0% from 5.1%
Governor Malhotra described the RBI as "neither dovish nor hawkish" and said the committee wanted greater clarity on the inflation outlook amid global uncertainty and volatility linked to the conflict in West Asia. The RBI said it expected headline inflation to peak in the October–December quarter before easing.
What Markets Will Watch
- The rate decision: Whether the MPC extends its pause or signals a change in direction.
- Inflation projections: Especially for the current quarter, which the RBI has flagged as the likely peak.
- Growth outlook: Updated GDP forecasts amid global trade and energy uncertainty.
- Liquidity measures: Any steps affecting banking-system liquidity ahead of the festive season.
- Commentary on global conditions, including US Federal Reserve policy and oil prices.
Why It Matters
The repo rate is the rate at which the RBI lends short-term funds to banks. It influences:
- Home, car and personal loan EMIs, especially for loans linked to external benchmarks
- Fixed deposit rates
- Business borrowing costs and investment
- Bond yields and the rupee
The October policy also comes just ahead of the festive season, when consumer demand and credit growth typically rise.
About the MPC
The six-member MPC includes three RBI members, including the Governor, and three external members appointed by the government. Its mandate is to keep CPI inflation at 4%, within a tolerance band of 2% to 6%, while supporting growth.
What Happens Next
The decision and Governor's statement are typically released at 10:00 am IST on the final day, followed by a press conference. The next scheduled announcement after October is on December 4, 2026.
FAQ
What is the current repo rate in India?
5.25%, unchanged since the MPC's recent reviews, pending the October 7 decision.
How often does the MPC meet?
At least four times a year; in practice it holds six scheduled meetings annually.