Archive · 9 Oct 2026
Goldman Sachs Sees Three More RBI Rate Hikes by June 2027
Goldman Sachs economist Santanu Sengupta thinks India’s central bank may raise interest rates three more times by June 2027.
Together, the increases would add about 75 basis points.
The possible schedule is December, February, and then April or June.
Sengupta expects India’s economy to grow by about 7% anyway.
But El Niño could make it harder for farms and could push prices higher in 2027.
Lower water in reservoirs might affect some crops, and smaller food stocks could add to price pressure.
Higher oil prices are another concern because India imports oil.
Goldman Sachs uses an oil-price assumption of $85 to $95 per barrel, while sustained prices above $100 could be more damaging.
Goldman Sachs economist Santanu Sengupta expects the Reserve Bank of India to raise rates three more times by June 2027, adding about 75 basis points.
The projected hikes are in December, February, and either April or June, with a possible pause after February to assess conditions.
Sengupta said India could still achieve roughly 7% economic growth despite global conditions and its reliance on imported oil.
He warned El Niño could weaken growth and raise inflation in 2027, particularly if lower reservoir levels affect the rabi harvest and inventories decline.
Goldman Sachs assumes oil prices of $85–$95 per barrel; Sengupta said sustained prices above $100 would pose a bigger risk to growth and inflation.
- Who
- Goldman Sachs Chief India Economist Santanu Sengupta and the Reserve Bank of India.
- What
- Goldman Sachs expects three additional RBI rate hikes, totalling about 75 basis points, by June 2027.
- When
- The forecast covers rate decisions through June 2027, with hikes projected for December, February, and April or June.
- Where
- India.
- Why
- The forecast reflects economic and inflation risks, including El Niño and crude oil prices.
Growth and inflation risks
Resilience and near-term buffers
El Niño’s economic effect
Growth and inflation risks
Sengupta warned El Niño could reduce growth and raise inflation in 2027, with lower reservoir levels potentially harming the rabi harvest.
Resilience and near-term buffers
He said the kharif harvest should be relatively unaffected and expects India to achieve roughly 7% growth.
Near-term inflation pressures
Growth and inflation risks
Sengupta said diminished stock levels by 2027 could allow inflation to accelerate.
Resilience and near-term buffers
He said current inventory levels should help contain inflationary pressures in the immediate future.
Crude oil exposure
Growth and inflation risks
Sustained oil prices above $100 per barrel would be a greater impediment to growth and inflation, Sengupta said.
Resilience and near-term buffers
The projections assume oil prices of $85–$95 per barrel, under which he still expects roughly 7% growth.
- Expected additional hikes
- Three
- Projected total increase
- About 75 basis points
- Forecast horizon
- By June 2027
- Projected timing
- December, February, and either April or June
- Growth outlook
- Roughly 7%
- Goldman Sachs oil-price assumption
- $85–$95 per barrel
- Oil-price risk cited
- Sustained prices above $100 per barrel