Repo rate
Repo = Repurchase Agreement Rate- How often
- At policy meetingsAt the end of each Monetary Policy Committee meeting (six a year), about 10:00 AM
- Next release
- Fri 4 DecIn 22 days · 10:00 AM
Raised by 25 bp, effective 7 October 2026.
Events on this chart
Source: RBI MPC, released 7 Oct 2026 · Chart: Clarity UPSC
- Previous
- 5.25%5 Aug 2026
- Highest
- 9.00%27 Apr 2001
- Lowest
- 4.00%22 May 2020
123 readings since 27 Apr 2001.
Story
The rate at which the Reserve Bank of India lends money to banks for a day. It is the main tool of monetary policy.
What is happening now As of 7 Oct 2026
On 7 October 2026 the Monetary Policy Committee (MPC) raised the repo rate by 0.25 percentage point to 5.50%. All six members voted for the rise. The MPC also changed its stance from neutral to 'calibrated tightening': rate cuts are off the table for now, and the next move can only be a rise or a pause. Two members wanted to keep the neutral stance. The rate is back at its level of a year earlier; it was cut to 5.25% in December 2025 and held there until this meeting.
The MPC said inflation is no longer as mild as it was last year. Consumer Price Index (CPI) inflation rose to 4.8% in August 2026 from 4.5% in July, mainly because of food and fuel prices, and core inflation, which leaves out food and fuel, rose to 4.2%. The MPC expects CPI inflation to average almost 5.8% over the next three quarters, above the 4% target, as a deficient monsoon, El Niño and high energy prices push prices up. It also saw a risk in the strong growth of money and bank credit. The economy grew 7.8% in April–June 2026, and the Reserve Bank of India projects 7.1% growth for 2026-27. The next meeting is on 2–4 December 2026.
Why it matters
The repo rate sets the price of short-term money for the whole economy. When the Reserve Bank of India (RBI) raises it, banks pay more for funds. They then charge more on loans and usually offer more on deposits. Floating-rate home loans and other retail loans linked to the repo rate are reset at least once every three months, so borrowers soon feel a change in their instalments.
The Monetary Policy Committee (MPC) uses the rate to keep inflation near its 4% target. A higher rate makes borrowing dearer, so households and firms spend less and price rises ease. A lower rate does the reverse and supports growth. Companies, investors and the government watch each decision, because bond yields and other interest rates move with it.
What it is
Banks borrow from the Reserve Bank of India (RBI) overnight when they are short of money. They pledge government securities and pay the repo rate as interest.
When the RBI raises the repo rate, borrowing becomes costlier across the economy. Banks charge more on loans, spending slows and price rises ease. A cut works the other way.
The Monetary Policy Committee sets the rate. It has six members: three from the RBI, including the Governor, and three experts appointed by the central government. Each member has one vote, and the Governor has a casting vote in a tie.
The other policy rates move with the repo rate. The Standing Deposit Facility rate sits 0.25 percentage point below it. The Marginal Standing Facility rate and the Bank Rate sit 0.25 percentage point above it.
Read this number
- The publisher
- The Monetary Policy Committee of the RBI sets the repo rate. Three members come from the RBI, including the Governor, and three are appointed by the central government.
- Decided by
- Monetary Policy Committee (6 members)
- Meetings
- Six a year
- Law
- RBI Act, 1934, Section 45ZB
- Corridor
- SDF below, MSF and Bank Rate above (±0.25 point)
Terms on this page (6)
- bp
- basis point (one hundredth of a percentage point)
- CPI
- Consumer Price Index
- MPC
- Monetary Policy Committee
- MSF
- Marginal Standing Facility
- RBI
- Reserve Bank of India
- SDF
- Standing Deposit Facility
History
- 2000The Reserve Bank of India (RBI) starts its Liquidity Adjustment Facility, with daily repo and reverse repo windows.
- 2016The Monetary Policy Committee is formed under the amended RBI Act and sets the rate from October 2016.
- 2022The Standing Deposit Facility replaces the fixed reverse repo as the floor of the rate corridor.
Readings
| Period | Value | Status | Released |
|---|---|---|---|
| 7 Oct 2026 | 5.50% | Final | 7 Oct 2026 |
| 5 Aug 2026 | 5.25% | Final | 5 Aug 2026 |
| 5 Jun 2026 | 5.25% | Final | 5 Jun 2026 |
| 8 Apr 2026 | 5.25% | Final | 8 Apr 2026 |
| 6 Feb 2026 | 5.25% | Final | 6 Feb 2026 |
| 5 Dec 2025 | 5.25% | Final | 5 Dec 2025 |
| 1 Oct 2025 | 5.50% | Final | 1 Oct 2025 |
| 6 Aug 2025 | 5.50% | Final | 6 Aug 2025 |
| 6 Jun 2025 | 5.50% | Final | 6 Jun 2025 |
| 9 Apr 2025 | 6.00% | Final | 9 Apr 2025 |
| 7 Feb 2025 | 6.25% | Final | 7 Feb 2025 |
| 6 Dec 2024 | 6.50% | Final | 6 Dec 2024 |
For UPSC
Know who sets the repo rate: the Monetary Policy Committee, under Section 45ZB of the Reserve Bank of India (RBI) Act, 1934. Know how it differs from the reverse repo, the Standing Deposit Facility (SDF) rate, the Marginal Standing Facility (MSF) rate and the Bank Rate, and how it passes through to loan rates.