Several prominent brokerages anticipate that the Reserve Bank of India will maintain a tightening stance into the first half of FY28, with the repo rate potentially climbing by roughly 75 basis points over that stretch.

Several major brokerages — among them BofA, Goldman Sachs, and UBS — have outlined a set of factors, namely regional conflict in the Middle East, disruptions to energy supply, and an intensifying El Niño cycle, that analysts at those firms believe carry the potential to lift headline consumer price inflation, according to a broadcast news outlet.

Two Wall Street institutions — Bank of America and UBS — are projecting that the central bank will move toward tighter monetary conditions, with their combined outlook pointing to a repo rate increase of roughly 75 basis points spread across Monetary Policy Committee sessions running through FY27 and into the opening half of fiscal 2028.

UBS placed full-year headline inflation at an average of roughly 5.2 per cent for FY27, with the rate seen holding above the 5 per cent mark through the opening two quarters of FY28 on account of weather-related supply pressures — a pattern the bank's global strategy team attributed to a documented tendency for economic effects to take hold anywhere from six to eighteen months after weather disruptions reach their peak. The brokerage projected that a peak window running from November through February would push the heaviest pressure on worldwide food prices into 2027 and the opening months of 2028, adding upward risks to the inflation trajectory.

Food-price pressures pushed India's consumer inflation to its highest reading in 23 months during September, a development that led brokerages to revise their outlooks to account for potential upside risks. Food and vegetable costs pushed the headline Consumer Price Index reading for September to 5.54 per cent, a notable climb from the 4.8 per cent recorded the previous month.

Across the two months from August into September, the cost of food products tracked by inflation measures moved from 5.97 per cent to 7.74 per cent, while the broader food and beverages category shifted upward from 5.66 per cent to 7.36 per cent.

Across rural communities, price pressures ran notably harder — consumer inflation reaching 6.08 per cent that September — than the 4.88 per cent recorded among urban households over the same period.

Compared with August's reading of 108.74, the combined category's General CPI index registered a value of 109.49 when September figures were tallied. Climbing from 110.73, the combined CFPI index reached a reading of 112.17 over that same stretch.