Following are the highlights of monetary policy statement made by RBI Governor Sanjay Malhotra:

MPC voted to hike repo rate by 25 bps to 5.50%

MPC decides change stance to calibrated tightening from neutral

Recalibrating the policy rate is an imperative

Policy action ahead can only be rate hike or pause.

Given the current conditions, rate cuts are off the table

Inflation

Core CPI inflation projected  at  4.4% current financial year

CPI inflation expected to average almost 5.8% in next three quarters

Inflation outlook not benign as it was last year

Difficult to distinguish between  second round effects and indirect impact of supply side pressures

Limited signs of supply side pressures getting embedded  in pricing behaviour

Food price increases have become more broad based

Near-term outlook on inflation points towards continued pressures from supply side

Early signs of inflation becoming generalised

Growth, Inflation estimates

RBI revises FY27 GDP growth estimate to 7.1% from 6.7% earlier

RBI revises July-September GDP growth estimate to 7.2% from 6.4% earlier

RBI revises October-December GDP growth estimate to 6.9% from 6.5% earlier

RBI revises January-March growth estimate to 6.8% from 6.8% earlier

RBI forecasts April-June 2027 growth estimate at 7.1%

RBI revises FY27 CPI inflation estimate to 5.2% from 5.0% earlier

RBI revises July-September CPI inflation estimate to 4.9% from 4.7% earlier

RBI revises October-December CPI inflation estimate to 6.0% from 5.9% earlier

RBI revises January-March CPI inflation estimate to 5.7% from 5.5% earlier

RBI revises April-June 2027 CPI inflation estimate to 5.6% from 5.3% earlier

RBI revises FY27 Core CPI inflation estimate to 4.4% from 4.3% earlier

Indian Econ

Indian economy expected to remain resilient

Economic activity holding momentum with some moderation compared to preceding quarter

Manufacturing activity, despite pressure, is holding well

Service sector activity remains steady and broad based

Private consumption remained broadly resilient

Some weakness observed in non-durable goods and domestic air passenger traffic

Private consumption remains broadly resilient, supported by discretionary spending

Fixed investment remains strong, as evidenced by several indicators

Govt's infra spend, a rebound in private capex expected to bolster investment

Merchandise exports recorded double-digit growth in July and August

Services exports also recorded accelerated growth in July and August

Transmission in the credit market reflected dissimilar movements in deposit  and lending rates.

Transmission in credit market reflected dissimilar movements

Credit growth continues to remain robust and broad based

To use appropriate mix of liquidity management tools

System level parameters of NBFCs are also sound

India's CAD remained modest despite headwinds

Banks, NBFCs system level financial parameters remain robust

CAD remained modest and well below sustainable levels in Q1

CAD widened in July due to higher merchandise trade deficit

Robust gross FDI reflects strong interest of global investors on India

BOP expected to record healthy surplus this year

Continue to implement policies that further add resilience, strength to economy

Financial markets

Remain committed to ensuring orderly adjustments to exchange rate

FPI recorded net outflows of $10.3 bln during FY27 through Oct 5

Remain committed to curbing excessive volatility in exchange rate

Foreign flows at $13.8 bln in first four months, higher than $8 bln in year-ago

Allowing interoperability amongst NBFC account aggregators

To constitute technical consultative committee for financial markets

Constituting committee for structured engagement on policy and financial matters

RBI Malhotra: MPC decided unanimously to hike repo rate by 25 bps

RBI: MPC voted change in stance to calibrated tightening by majority of 4-2

 Global cues

Global inflation expected to rise

Re-escalation of West Asia conflict heightened financial market  volatility

West Asia conflict pose significant downside risks to global econ output

Global economic uncertainty, supply chain disruptions  to have some bearing  on domestic economic

Global trade growth moderation, elevated energy prices,  trade policy uncertainties  pose upside risks to India's CAD

West Asia conflict, trade uncertainties, elevated bond yields keeping  global economic sentiments edgy