Market analysts are keenly watching for any hints on future rate actions.

The Reserve Bank of India (RBI) commenced its three-day Monetary Policy Committee (MPC) meeting today, with the policy announcement scheduled for October 9. This meeting is highly anticipated as the central bank has maintained the repo rate at 6.50% for nine consecutive sessions, balancing inflation control and economic growth.

Chaired by RBI Governor Shaktikanta Das, the committee will evaluate several key factors, including inflation trends, global uncertainties, and domestic growth projections. Inflation, especially in food and fuel prices, remains a concern despite the overall Consumer Price Inflation (CPI) in August standing at 3.65%—within the RBI's target band. However, food inflation, at 5.65%, continues to exceed the central bank’s medium-term target of 4%.

While the RBI has opted for a status quo to support post-pandemic economic recovery, rising global crude oil prices—driven by tensions in West Asia—could force the central bank to reconsider its approach.

This is the first policy meeting since the appointment of three new external members to the MPC. The committee is now composed of the Governor, Deputy Governor in charge of monetary policy, and one officer from the RBI, along with external members Professor Ram Singh, Saugata Bhattacharya, and Dr. Nagesh Kumar.

Market analysts are keenly watching for any hints on future rate actions. While many expect the RBI to continue its cautious stance, some are not ruling out the possibility of a surprise rate hike given the current economic challenges.