The Reserve Bank of India (RBI) is preparing to announce the outcome of its latest bi-monthly Monetary Policy Committee (MPC) meeting on Wednesday, October 1, at 10 AM.
This crucial decision will be delivered by RBI Governor Sanjay Malhotra and streamed live on the central bank’s YouTube channel, X handle, and official website. A press conference will follow at noon, providing further clarity on the central bank’s assessment and policy stance.
Inside the MPC Process
The current meeting of the six-member MPC began on September 29 and will conclude with Wednesday’s announcement. The panel is chaired by Governor Malhotra, with members tasked with reviewing macroeconomic conditions and setting key policy rates, most notably the repo rate. These meetings occur every two months, making them a cornerstone of monetary policy planning. Future reviews are already scheduled for December 3–5, 2025, and February 4–6, 2026.
The RBI’s decisions carry significant weight, shaping borrowing costs, investment flows, and overall economic momentum. Each announcement is closely scrutinised by markets, corporates, and households alike.
Expectations from the October MPC
Analysts remain split on whether the RBI will hold rates or deliver a modest cut. Many expect the repo rate to stay unchanged at 5.50 per cent, especially after a cumulative reduction of 100 basis points earlier this year.
The central bank maintained status quo during its August meeting, preferring to evaluate the ripple effects of global uncertainties, including fresh US tariffs of 50 per cent on Indian shipments.
A Goldman Sachs report predicts no immediate change, with the RBI maintaining a neutral stance but adopting a dovish tone. It anticipates another 25-basis-point cut in December, supported by easing inflation, a softer Federal Reserve outlook, and expectations of a weaker US dollar.
However, it flagged the possibility of an earlier cut in October should downside growth risks intensify.
Similarly, Bajaj Broking noted that August’s decision to hold rates followed a 50-basis-point reduction in June 2025. It expects the RBI to remain cautious, balancing inflation control with the need to support growth.
What Do Industry Experts Say?
Industry leaders hold varied expectations. Praveen Sharma, CEO of Housing.com, argued that a rate cut during the festive season would provide a strong boost to homebuying sentiment. He said, “If banks transmit the benefit fully, it would not only lift buyer sentiment and affordability, but also nudge fence-sitters to take that long-awaited decision.”
Vineet Agrawal, Co-founder of Jiraaf, made the case for holding rates steady. He said, “The RBI has already frontloaded monetary easing with a 100-basis-point cut, laying a solid foundation for growth. In the September–October policy review, I expect the central bank to hold rates steady at 6.25 per cent, given the economy’s strong 7.8 per cent expansion in Q1 FY26. The recent GST reductions are set to provide a consumption-led boost, limiting the need for immediate policy action.”
However, Agrawal said that a 25 bps rate cut is more probable towards the end of FY26. ” Overall, this policy cycle is about continuity, predictability, and anchoring expectations rather than delivering near-term surprises,” he noted.
Debopam Chaudhuri, Chief Economist, Piramal, echoed his agreement for another rate cut from the central bank. “We expect the RBI to deliver a 25 bps rate cut in its October policy, while maintaining an accommodative stance. The overall communication is likely to carry a dovish tone, underscoring the central bank’s continued support for growth alongside its inflation management objectives. A calibrated reduction in rates at this stage would help improve credit transmission and provide further impetus to investment and corporate borrowing,” he explained.
Repo Rate: Why It Matters
The repo rate, the rate at which RBI lends to commercial banks, has direct consequences for consumers and businesses. Lower rates reduce EMIs on loans, boosting affordability, but also lower interest returns for savers. In recent months, the RBI cut rates in February, April, and June, before pausing in August to monitor inflation and growth trends.
Inflation has cooled sharply, with State Bank of India research projecting CPI around 1.1 per cent in October. New GST rules, effective from September 22, have also trimmed prices across goods and services. Together, these trends provide the RBI with policy space to act without risking stability.
With geopolitical headwinds and trade tensions still in play, the RBI’s October decision will be closely examined for both its immediate impact and its forward-looking guidance.
While a status quo is the consensus, the possibility of a 25-basis-point reduction cannot be ruled out. As India heads into its festive season, the central bank’s stance will play a key role in shaping consumer demand, investment flows, and economic sentiment in the months ahead.
