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The Reserve Bank of India has unanimously decided to increase the benchmark repo rate by 25 basis points. This decision was made amid rising inflation projections and increasing US bond yields. The bank also …

The Reserve Bank of India has unanimously decided to increase the benchmark repo rate by 25 basis points. This decision was made amid rising inflation projections and increasing US bond yields. The bank also revised its economic growth forecast for FY27 to 7.… Mumbai: Monetary policymakers at the Reserve Bank of India (RBI), as widely expected, unanimously voted Wednesday to raise the benchmark repo rate by 25 basis points to 5.50% amid higher inflation pr…

India's central bank hiked interest rates today for the first time since 2023 as the Middle East conflict stokes inflation in Asia's third-largest economy and batters a weakened rupee. The Reserve Bank of India …

India's central bank hiked interest rates today for the first time since 2023 as the Middle East conflict stokes inflation in Asia's third-largest economy and batters a weakened rupee. The Reserve Bank of India (RBI) said the benchmark repurchase rate, the level at which it lends to commercial banks, would be raised by 25 basis points to 5.5% after a unanimous vote by a six-member panel. In doing so, the Reserve Bank of India shifted gears to join several central banks around the world who have raised rates to curb price rises or boost their currencies. Since the outbreak of the Iran war in February, the Reserve Bank of India has stood pat as it waited to assess the impact of volatile oil prices on the world's fastest-growing major economy. But resilient GDP growth last quarter has allowed it to focus on higher costs in a country that imports most of its energy and has been hit by a weak monsoon that could result in a spike in food prices. Retail inflation rose to 4.8% in August - the third month in a row that headline inflation breached the Reserve Bank of India's medium term target of 4% - with data signalling that inflationary pressures had spread beyond food and transport. "It is clear that inflation and its outlook are not benign as they were last year," Reserve Bank of India governor Sanjay Malhotra said in a televised address from financial capital Mumbai, noting that there was "some evidence of... generalisation of inflation". 'Calibrated tightening' "The MPC (monetary policy committee) also decided to change the stance to calibrated tightening," he said. "It underscored that given the current conditions, rate cuts are off the table in the near term, and policy action ahead can only be a rate hike or a pause, depending on the evolving conditions and the outlook," he added. The hike was the first since February 2023 and analysts said the central bank will likely lift them again. "The rising interest rate backdrop globally has reduced RBI's degrees of freedom. We see likelihood of another 50 bps hike this cycle," said Garima Kapoor of Elara Capital. Adding to the central bank's calculations is pressure on the Indian rupee, which has been at near record lows over the past week. To stem the fall, the Reserve Bank of India has rolled out an array of moves to woo dollar inflows, including a deposit scheme for the Indian diaspora that raked in around $127 billion. While the steps helped stem the rupee's losses, the currency has faced fresh challenges as foreign investors continue to dump Indian equities and crude hovers around $100 a barrel. India, the world's third-largest buyer of oil, normally sources about half of its crude through the Strait of Hormuz, which has been effectively closed since the beginning of the Middle East war. Analysts say this makes India among the most vulnerable economies to a global energy shock, as higher crude and fertiliser prices drive up the import bill.

Congress slams Centre after RBI raises repo rate to 5.5% Join conversation View All Comments → Share your thoughts in the comments Insightful Agree Disagree Skeptical Concerning Promising Worth Reading Big Development Post Comment …

Congress slams Centre after RBI raises repo rate to 5.5% Join conversation View All Comments → Share your thoughts in the comments Insightful Agree Disagree Skeptical Concerning Promising Worth Reading Big Development Post Comment Be respectful · TOI community guidelines NEW DELHI: The Congress on Wednesday attacked the Centre after the Reserve Bank of India (RBI) raised the repo rate by 25 basis points to 5.50%, saying the move would further increase the financial burden on the public.Calling Prime Minister Narendra Modi “inflation man”, the Congress said, “Inflation Man Modi's reign of terror continues. Now the public's back will be broken even further.”The party said the rate hike would push up borrowing costs for home, car, personal and business loans, resulting in higher EMIs and potentially longer repayment periods. “To curb inflation as per Modi's intent, the RBI has today raised the repo rate by 25 basis points to 5.5%,” it said."This means your home loan, car loan, personal loan, and business loan interest rates will now increase. Now you'll have to pay higher EMIs, and the loan repayment period will also get extended. The promise was of 'good days,' but what we got were days of extortion," he added.The RBI's monetary policy committee unanimously approved the hike and shifted its stance from neutral to calibrated tightening, citing stronger-than-expected economic growth and broader price pressures.The rate increase would raise the monthly EMI on a Rs 1 crore home loan with a 15-year tenure by around Rs 1,500, assuming a base rate of 8.50%. If borrowers keep their EMI unchanged, the higher interest rate could extend the repayment period by roughly six instalments.The RBI also raised its FY27 real GDP growth forecast by 40 basis points to 7.1%, while increasing its inflation projection by 20 basis points to 5.2%. RBI governor Sanjay Malhotra said stronger capacity utilisation, bank credit growth, government capital expenditure and infrastructure spending were supporting investment and demand.CPI inflation rose to 4.8% in August from 4.5% in July. Malhotra said price pressures had broadened beyond volatile items, with food inflation becoming more widespread, including higher sugar and onion prices.The Congress said the government's promise of “good days” had instead delivered “days of extortion”.

RBI Flags Elevated AI Asset Valuations, Geopolitical Tensions & High Debt As Major Risks To Global Economic Outlook | X / IANS Mumbai: The Reserve Bank of India has flagged elevated valuations of artificial …

RBI Flags Elevated AI Asset Valuations, Geopolitical Tensions & High Debt As Major Risks To Global Economic Outlook | X / IANS Mumbai: The Reserve Bank of India has flagged elevated valuations of artificial intelligence-related assets as one of the key downside risks to the global economic outlook, alongside geopolitical tensions, tighter global financial conditions and high public debt. Let us know! 👂 What type of content would you like to see from us this year? — HubSpot (@HubSpot) In its Monetary Policy Statement for 2026-27, the RBI said the global economy has remained resilient, but the re-escalation of the West Asia conflict and volatility in crude oil prices have kept the global economic environment uncertain. Governor said, “With a resolution of the West Asia conflict remaining elusive, significant downside risks to the global outlook remain, including further tightening of global financial conditions, continuing elevated AI-related asset valuations and high public debt”. The RBI's reference to AI-related asset valuations comes as part of its broader assessment of risks to global financial and economic conditions. The central bank also said the resolution of the West Asia conflict remains elusive, adding to uncertainty around the global outlook. The central bank also noted that inflation has accelerated in key economies, prompting a shift towards tighter monetary policy. The US Federal Reserve raised its policy rate by 25 basis points in September, while rate tightening by other major systemically important central banks has also strengthened expectations of higher global policy rates. Despite these risks, the RBI said the Indian economy has remained resilient. According to National Statistics Office estimates, real GDP growth in Q1 of 2026-27 stood at 7.8 per cent, higher than expected. Strong private consumption and fixed investment, a rebound in merchandise exports and sustained growth in services exports supported economic activity, the RBI said. On the supply side, manufacturing grew at a robust pace, while services activity strengthened on the back of domestic and external demand. The central bank said available high-frequency indicators for July-August suggest that domestic economic activity has maintained momentum in Q2. Domestic demand remains resilient and is supported by robust external demand, with merchandise exports registering double-digit growth. However, the RBI cautioned that global economic uncertainty could continue to affect domestic activity. Energy prices and supply chain pressures remain uncertain amid the West Asia conflict. The central bank said the adverse impact of these pressures is being contained through active diversification of supply sources. Domestic risks are also present. The RBI said a deficient southwest monsoon and strong El Niño conditions pose risks to agriculture and rural demand, although healthy foodgrain buffers and proactive government interventions are expected to reduce the impact. At the same time, continuing momentum in services and broadly stable employment conditions are expected to support urban demand. Strong capacity utilisation, robust credit flows and the government's infrastructure push are expected to sustain investment activity. The central bank revised the country’s growth projections for 2026-27 to 7.1 per cent from 6.6 per cent, with Q2 growth at 7.2 per cent, Q3 at 6.9 per cent and Q4 at 6.8 per cent. RBI also raised concerns over inflation pressures, saying headline CPI inflation is expected to average almost 5.8 per cent over the next three quarters, while core inflation is projected at 4.4 per cent for 2026-27. The RBI said the Indian economy remains resilient, but the combination of global financial tightening, geopolitical uncertainty, commodity price pressures and elevated AI-related asset valuations could shape the global economic environment in the period ahead. (Except for the headline, this article has not been edited by FPJ's editorial team and is auto-generated from an agency feed.)

Two factors worked to decide MPC’s move: inflationary pressures persist and growth is beating estimates. Hence, a hike in repo rate, while helping keep inflation in check, is unlikely to substantially impact GDP growth. …

Two factors worked to decide MPC’s move: inflationary pressures persist and growth is beating estimates. Hence, a hike in repo rate, while helping keep inflation in check, is unlikely to substantially impact GDP growth. The Indian economy has remained robust,… EMI CalculatorDetermine the monthly installment amount for a loan

Rising inflation forecasts, a fresh RBI rate hike to 5.50% and stubbornly high costs for fuel, food and imports have put borrowing and spending under pressure. At the same time, these conditions shift the …

Rising inflation forecasts, a fresh RBI rate hike to 5.50% and stubbornly high costs for fuel, food and imports have put borrowing and spending under pressure. At the same time, these conditions shift the spotlight to lenders that could benefit from higher le… Rising inflation forecasts, a fresh RBI rate hike to 5.50% and stubbornly high costs for fuel, food and imports have put borrowing and spending under pressure. At the same time, these conditions shif…

Synopsis The Reserve Bank of India recently raised the repo rate by 25 basis points to curb inflation. This increase is expected to raise borrowing costs for banks, affecting interest rates on home loans. …

Synopsis The Reserve Bank of India recently raised the repo rate by 25 basis points to curb inflation. This increase is expected to raise borrowing costs for banks, affecting interest rates on home loans. First-time and price-sensitive homebuyers in the affordable housing sector may feel the impact more significantly. Market experts anticipate that strong demand fundamentals will mitigate some negative effects. The overall housing market remains robust, especially in higher-priced segments.

HANOI, Oct 7 : The rise in annual inflation in September has put pressure on Vietnam's monetary policy management for the rest of this year but prices remain under control, central bank deputy governor …

HANOI, Oct 7 : The rise in annual inflation in September has put pressure on Vietnam's monetary policy management for the rest of this year but prices remain under control, central bank deputy governor Pham Thanh Ha said on Wednesday. • Vietnam's annual inflation in September was 5.08 per cent, compared with 4.89 per cent in August, according to data from the statistics office. • "This is the highest reading in several years, putting huge pressure on managing prices and controlling inflation during the rest of the year," Ha told a regular press conference in Hanoi. • Ha said recent interest rate hikes by central banks, including the Fed, has also put pressure on emerging and developing economies, including Vietnam. • Export-reliant Vietnam has faced higher prices for imported fuels this year due to the Iran war. • Total bank lending as of September 30 had risen 11.59 per cent from the end of last year, and was up 16.69 per cent from a year earlier, Ha said. • The country has a target of keeping inflation at 4.5 per cent this year. • Vietnam reported gross domestic product growth of 9.95 per cent in the third quarter, and its fourth quarter growth must be higher than 12 per cent for the country to meet its full-year growth target of at least 10 per cent, the head of the central bank's monetary policy department, Pham Chi Quang, told the same conference. • The central bank said it will pursue flexible monetary policy for the rest of the year, striking a balance between keeping inflation under control and supporting economic growth. • It will boost lending to business and manufacturing projects while tightening control over lending to risky sectors, it said.

Real estate companies in West Bengal on Wednesday said the RBI's 25-basis point repo rate hike could increase borrowing costs for homebuyers and developers, but maintained that the rise is unlikely to impact demand …

Real estate companies in West Bengal on Wednesday said the RBI's 25-basis point repo rate hike could increase borrowing costs for homebuyers and developers, but maintained that the rise is unlikely to impact demand in the long term. The Reserve Bank of India raised its benchmark interest rate by 25 basis points to 5.50 per cent on Wednesday, its first increase in nearly four years. "The RBI has increased the repo rate after three years As a result, interest rates of banks and financial institutions on housing and construction loans will increase. This will have some adverse impact on real estate," CREDAI West Bengal president Sushil Mohta said. Primarc Projects MD Siddharth Pansari said the hike may make home loans marginally more expensive, but is unlikely to have a major impact on genuine homebuyers. "In Kolkata, people are buying homes with a long-term view, and their decisions are increasingly driven by the right location, better quality and the lifestyle a home offers. There may be some caution in the short term, but the underlying demand for good homes remains strong," he said. MD of Purti Realty Mahesh Agarwal said the immediate impact could be felt through higher home loan costs, while developers may also face a marginal increase in the cost of capital. "However, we do not anticipate this to fundamentally alter the long-term trajectory of the housing market," he said, adding that demand for quality homes is increasingly supported by income growth, evolving lifestyles and infrastructure development. Emami Realty MD and CEO Nitesh Kumar said the rate hike could temporarily affect affordability, particularly for financing-dependent first-time buyers, and those in the affordable-to-mid segment, coming as it does at the beginning of the festive season. "Despite short-term borrowing-cost pressures, strong cultural and financial intent continues to support festive real estate demand. Developers are responding with flexible payment plans, stronger value propositions, and targeted offers to sustain quarterly momentum," Kumar said. Knight Frank India Chairman and MD Shishir Baijal said the 25-basis-point hike was broadly in line with expectations amid weak monsoons, the potential impact of El Nino, geopolitical conditions and inflationary pressures. "The shift to a 'calibrated tightening' stance signals that further rate action will remain data dependent. For real estate, higher borrowing costs could create some affordability pressures, particularly in interest-rate-sensitive and lower-priced segments, but we do not expect a material disruption to the sector's broader trajectory in the near future," Baijal said.

Treasury Secretary Scott Bessent says the economy is "accelerating" and inflation, along with bond yields, will come back down once the conflict in Iran ends. "Right now, we have this energy shock that's generated …

Treasury Secretary Scott Bessent says the economy is "accelerating" and inflation, along with bond yields, will come back down once the conflict in Iran ends. "Right now, we have this energy shock that's generated by the Iran conflict, and headline inflation is about 3.5%. But my message is underlying inflation — core inflation — is down to about 2.3%," Bessent said at the Pennsylvania Chamber of Commerce on Monday night. He asserted that median wage growth is in line with headline inflation, and that "we will get to the other side of this Iran conflict. Energy will come back down, and the wage growth will continue." Read more: How oil price shocks ripple through your wallet, from gas to groceries He said 1 million private sector jobs have been created this year, while government jobs have been trimmed by 300,000. "Real wage growth comes from private sector jobs, and I think we're just starting to see the acceleration here," he said. But not everyone sees the wage picture the same. Gregory Daco, chief economist for EY, notes that average hourly earnings rose at an annualized pace of 3% in September, marking the slowest pace of the post-pandemic cycle. He said he expects inflation in September, as measured by the Consumer Price Index, to clock in at 3.6%, and as a result, he anticipates that wages adjusted for inflation will likely fall 0.6% year over year, marking a sixth consecutive month of contraction. "While strong wealth effects from stock market gains continue to support solid aggregate consumer spending, the growing income squeeze affecting households is likely to cap spending growth heading into 2027," Daco said. Joe Brusuelas, chief economist for RSM, agrees that the economy accelerated into the third quarter, but he asserts that inflation is not easing, pressuring wages and purchasing power. Brusuelas maintains that the CPI report due out next week will show that wage growth adjusted for inflation has been flat to negative since the start of the Iran war. "It's far more likely that declining real wages begin to act as a mild drag on growth heading into the final quarter of 2026 and early 2027," he said. Higher bonds: strong economy or oil prices? Bessent also addressed the spike in long-term Treasury yields, saying he believes the run-up is a function of headline inflation and higher energy prices stemming from the war. Once the conflict ends, he said, longer-term bond yields will come down to levels seen in mid-February before the war. "I don't know if this conflict's going to end next week, next month, in two months, but I believe on the other side of this, energy prices will be much lower and interest rates, mortgage rates will come back down," he said.