RBI raises interest rates, hikes FY27 growth forecast by 40 bps and inflation by 20 bps

In a notable move, the Reserve Bank of India has adjusted the repo rate, increasing it by 25 basis points to 5.50%. This adjustment comes in response to stronger-than-anticipated economic growth alongside rising price pressures. Additionally, the RBI has updated its FY27 GDP growth prediction to 7.1%, indicating optimistic economic performance. Meanwhile, inflation forecasts have been revised upwards, predicting Consumer Price Index inflation to hover around 5.8%.