The December 2026 MPC Raises the Repo Rate Again
Published 13 October 2026
On 7 October the MPC raised the repo rate to 5.50 per cent on a unanimous vote and moved to calibrated tightening. Our October entry had said no hike at 0.90, with a Reuters poll majority for a hike never recorded on the page. This entry is the repaired successor: it asks the live question, carries the poll, quotes the failure, and sits near the consensus.
Stated probability 0.6 against a base rate of 0.55. The base rate is the Reuters poll of 18 to 28 September: 29 of 53 economists who gave a December view expected at least one further 25 basis point increase. The MPC's own record of consecutive increases at the start of a cycle (2018 and 2022, two of two) is too thin to stand alone and is noted, not used. The tilt rests on the committee's stated path: a Q3 FY27 projection of 6.0 per cent against a September print of 5.54 with food at 7.74, and a stance named calibrated tightening.
Design and lineage
Successor to RBIOCT2026, which failed. Its reconciled result reads: FAILED (reconciled 2026-10-13). The MPC raised the policy repo rate by 25 basis points to 5.50 per cent on 7 October 2026 on a unanimous vote, and moved the stance to calibrated tightening by four votes to two. The call required no increase and was stated at 0.90. A Reuters poll of 61 economists taken between 18 and 28 September had 35 expecting this hike; the entry carried no record of it. Failure ledger causes C7 and C2: a franchise rolled forward without re-underwriting the regime, with the live consensus unrecorded. Source: RBI press release 63742, Resolution of the Monetary Policy Committee, 7 October 2026. Two changes follow. The question is now the live one, whether tightening continues, and the stated probability sits within five points of the poll. The prior result is quoted, not restated, which is the rule introduced after the September FOMC failure.
What was recorded at filing
Consensus: Reuters poll, 18 to 28 September 2026: 29 of 53 economists expect at least one further 25 bps increase at the December meeting (Reuters poll as reported by Outlook Money, 1 October 2026, 2026-10-01). Base rate basis: Reuters poll share for a December increase (29 of 53); MPC record of consecutive early-cycle hikes is 2 of 2 (2018, 2022), noted as too thin to use. Seasonal check: December meetings 2023, 2024, 2025: hold, hold, cut; the cycle position differs from all three and the check is recorded for the record. Level at filing 5.5, threshold distance 0.0 standard deviations.
How it reconciles
The verdict publishes by 6 December 2026 on this page and on the public board, quoting the reference named in the call. A failed entry is graded at full weight, stays on the board with its reasoning unedited, and adds a row to the failure ledger.
Frequently asked
What is the call?
That the December 2026 MPC raises the policy repo rate from 5.50 per cent. A hold or a cut fails it.
Why file at 0.6 and not higher?
Because the poll says 55 per cent and the committee has said the next move could be a pause. The October entry sat at 0.90 against a poll majority the other way; that is the error this entry is built to avoid.
What is the base rate drawn from?
The Reuters poll share for a December increase. The MPC's own record of consecutive early-cycle hikes is two of two, which is stated and not relied upon.
What happened to the October call?
It failed. The committee hiked 25 basis points unanimously and the entry had required no increase at 0.90. The full account and the ledger entry are on that page.
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Published 13 October 2026. A dated forward call with its reconciliation condition stated in advance; the verdict will be recorded on this page and on the public board. Not financial, medical or personal advice.