Archive · 22 Sep 2026
Nomura Sees Two RBI Rate Hikes In 2026
Nomura thinks India’s central bank may raise interest rates twice in 2026.
The possible increases could happen in October and December.
The reason is that prices may rise by more than 6 percent.
Higher interest rates can make loans for homes, vehicles and businesses more expensive.
Even so, India’s economy is expected to grow strongly at 7 percent in FY27.
Nomura also says India could attract more foreign investment, especially in advanced manufacturing.
The US Federal Reserve may raise its rates again if American inflation stays high.
Global trade tensions and expensive fuel could make the economic outlook more difficult.
Nomura expects the Reserve Bank of India to raise rates at its October and December 2026 monetary policy meetings.
India’s GDP is forecast to grow 7% in FY27, while retail inflation could soon exceed 6%.
Higher repo rates could increase borrowing costs for households and businesses.
Strong foreign-currency non-resident deposit inflows could support India’s external position and create a balance-of-payments surplus.
Nomura expects another US Federal Reserve hike, while global tensions, trade restrictions and elevated fuel prices remain risks.
- Who
- Nomura, through its Head of Global Macro Research Rob Subbaraman, and the Reserve Bank of India.
- What
- Nomura expects two RBI interest-rate increases in 2026 and another possible US Federal Reserve hike this year.
- When
- The RBI increases are expected at its October and December 2026 meetings; the Federal Reserve hike is most likely in December this year.
- Where
- The policy outlook concerns India and the United States, with effects linked to global markets and trade.
- Why
- Persistent inflation, including a possible rise in Indian retail inflation above 6%, could prompt tighter monetary policy.
- RBI rate outlook
- Two increases are expected in October and December 2026.
- India GDP forecast
- Nomura forecasts 7% growth for FY27.
- Indian inflation risk
- Retail inflation could exceed 6% in coming months.
- Investment outlook
- India could attract more global capital and gain ground in higher-end manufacturing.
- External position
- Strong FCNR-B deposit inflows could contribute to a balance-of-payments surplus.
- US Federal Reserve
- The Fed recently raised its policy rate by 25 basis points to 3.75%–4%.
- Global energy risk
- US petrol prices are nearing $4.50 and diesel prices are near $6.50.
