Reserve Bank of India (RBI) can maintain the repo rate at 5.25% in the upcoming meeting on 8th April. According to the latest survey by Reuters, most economists believe that RBI will not make any change in interest rates at least till mid-2027. Only 2 out of 71 experts have given a different opinion.
Inflation under control, growth strong
Inflation in India has remained below the RBI target of 4% for the last one year, which has brought relief to the central bank. At the same time, the country's economic growth also remains strong. This is why RBI currently has scope to keep interest rates stable.
Middle East tension increases risk
However, the ongoing tension between America, Israel and Iran has increased uncertainty in the global oil market. This has affected important oil supply routes, which can be a cause of concern for a big oil importing country like India. Due to this, there is a danger of increasing pressure on inflation.
Experts' opinion: It is too early to increase the rate now
According to ANZ economist Dheeraj Nim, at present inflation is quite balanced, so the economy can bear the impact of fluctuations in oil prices. At the same time, HDFC Bank economist Sakshi Gupta says that it is too early to consider increasing interest rates. Abhishek Upadhyay of ICICI Securities Primary Dealership said that RBI has to be cautious and should not ignore the risk of inflation.
Forward Estimates and Risks
According to the survey, inflation is expected to be on average 4.3% and economic growth to be around 7% in the next two financial years. However, the biggest threat facing the Indian economy in 2026-27 may be a combination of slow growth and rising inflation. In such a situation, it will be challenging for RBI to maintain balance.
