{
  "id": 7381577,
  "title": "SBI Research, IDFC First expect rate hike in Oct",
  "url": "https://urgent.news/2026/09/14/sbi-research-idfc-first-expect-rate-hike-in-oct",
  "topic": "business",
  "section": "Business",
  "published": "2026-09-14T18:53:30.000Z",
  "source": {
    "name": "The Economic Times",
    "slug": "the-economic-times",
    "url": "https://economictimes.indiatimes.com/news/economy/indicators/sbi-research-idfc-first-expect-rate-hike-in-october-as-crude-prices-climb-higher-oil-prices-inflation-raise-likelihood-of-policy-tightening/articleshow/134246894.cms"
  },
  "original_language": "en",
  "account": "Economists are anticipating a potential interest rate increase by the central bank as early as October, reversing previous expectations of steady rates throughout the year due to excess liquidity. IDFC First Bank and SBI Research now forecast a 25-basis-point (bps) hike next month, attributed to a significant surge in crude oil prices triggered by escalating tensions in the West Asia region. Axis Bank's CEO, Amitabh Chaudhry, warns that a rate hike may be necessary sooner rather than later to address rising inflation concerns.\n\nThe Monetary Policy Committee of the Reserve Bank of India, comprising six members, will convene from October 5 to 7 to evaluate the interest rates, with the current repo rate set at 5.25%. IDFC First Bank and SBI Research attribute the growing odds of policy tightening to surging crude oil prices, currently hovering around $108 a barrel, persistent food inflation, and robust economic growth. They emphasize that prolonged supply-side shocks could exacerbate inflationary pressures and inflation expectations, despite the RBI reducing liquidity in the banking system.\n\nAxis Bank's Chaudhry had previously cautioned about inflation risks stemming from higher oil prices and a narrowing India-US interest-rate differential, suggesting a rate hike may be warranted at a Global Fintech Fest event. Until recently, most economists had anticipated the RBI to maintain rates at present levels until at least the year's end, buoyed by surplus liquidity and the central bank's relatively measured stance at the August policy review. The RBI is expected to initiate a rate hike cycle, with cumulative increases of 50 bps to 75 bps, driven by inflation normalization rather than widespread price pressures, according to IDFC First Bank's chief economist, Gaura Sen Gupta.\n\nThe rate hike cycle may commence in October or December, with higher chances of an October start as inflation is projected to peak in the third quarter of fiscal year 2027. SBI's group chief economic adviser, Soumya Kanti Ghosh, stated in a report that they strongly advocate a 25-bps rate hike in the upcoming October policy, followed by another in December in rapid succession. India's headline retail inflation climbed to 4.82% in August from 4.45% in July, aligning with the RBI's 5% projection for fiscal year 2027, with upside risks arising from food and fuel prices. Economic growth was projected at 7.8% in the first quarter.",
  "summary": null,
  "key_points": [
    "SBI Research and IDFC First Bank predict Oct rate hike",
    "25-basis-point increase expected due to oil price surge",
    "RBI Monetary Policy Committee to meet Oct 5-7"
  ],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}