RBI MPC Meeting Starts, Repo Rate Seen at 5.25%

India's Reserve Bank began a three-day Monetary Policy Committee meeting on Monday to review its first bimonthly policy for the 2026-27 fiscal year, with economists anticipating no change to the benchmark repo rate of 5.25 percent amid escalating geopolitical tensions in West Asia that have driven up oil prices and inflation risks.

The six-member panel, led by Governor Sanjay Malhotra, will announce its decision on Wednesday. This comes as the ongoing conflict, which erupted in late February 2026, has disrupted global energy markets, pushing Brent crude prices above 100 dollars per barrel from around 60 dollars earlier in the year. The de facto closure of the Strait of Hormuz has marked the largest oil market disruption since 1973, according to analysts, exacerbating imported inflation in India, a nation that imports nearly 90 percent of its crude needs.

Retail inflation eased to 3.21 percent in February, nearing the central bank's medium-term target of 4 percent, but experts warn of potential second-round effects on fuel, transportation, and core prices. Every 10-dollar rise in crude prices could add up to 0.60 percentage points to inflation, estimates suggest. The rupee has...