RBI raises repo rate to 5.50%, lifts FY27 GDP growth forecast to 7.1%

The Reserve Bank of India raised the repo rate by 25 basis points to 5.50%, marking the first rate increase since February 2023. The move signals a shift towards calibrated monetary tightening to contain inflation.

The RBI lifted its GDP growth forecast for FY27 from 6.7% to 7.1%, reflecting sustained economic resilience. However, the central bank revised upward its CPI inflation projection to 5.2%, citing pressure from rising food and fuel prices.

The Monetary Policy Committee's stance adjustment underscores its focus on managing inflationary pressures while supporting economic growth.