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Informist, Wednesday, Oct. 7, 2026

NEW DELHI - Churchil Bhatt, senior executive vice president- investment, Kotak Life Insurance, said the following on the Reserve Bank of India's fourth bi-monthly monetary policy statement for 2026-27 (Apr-Mar) detailed Wednesday:

In line with market expectations, the RBI-led MPC increased the policy repo rate by 25 bps and changed its policy stance from neutral to calibrated tightening, reflecting its focus on containing the second-round impact of the otherwise supply-side inflationary pressures. The decision comes against the backdrop of resilient domestic growth, firming inflation expectations, elevated commodity prices, weather disruptions and persistent global uncertainties.
 
The central bank also revised its macroeconomic projections, raising its FY27 GDP growth forecast by 40 bps to 7.1% and FY27 CPI inflation forecast by 20 bps to 5.2%, reflecting the impact of higher food and energy prices. Core inflation for the year is projected at 4.4%. While no incremental liquidity measures were announced in the policy statement, the market expects the RBI to deploy an appropriate mix of liquidity management tools to align the weighted average call rate with the policy repo rate, as and when required. Given the policy action was largely on expected lines, the 10-year benchmark yield is currently in the range of 7.23-25%, with an upside bias.  End

Compiled by Gunjan Rajput

Filed by Akul Nishant Akhoury

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