India’s Inflation Hits 6.09% in October, Exceeding Central Bank’s Tolerance Band
Key Facts
India’s annual consumer price inflation reached 6.09% in October 2026, up from 5.54% in September, according to government data cited by Reuters on November 12. The reading was above the Reuters poll forecast of 5.93%. Inflation thus exceeded the upper limit of the Reserve Bank of India’s tolerance band, which is 6%. The bank targets medium-term inflation of 4%, within a tolerance band of 2% to 6%. October data were published on November 12, 2026, putting the price trajectory at the forefront of investors’ focus ahead of the next Monetary Policy Committee meeting.
Food inflation was one of the main sources of pressure in the reading, rising to 8.94% year over year in October, compared with 7.74% in September, according to data from India’s Ministry of Statistics published through the government’s Press Information Bureau. The comparison shows that the acceleration was not limited to the headline figure; food inflation also rose between the two months. Government data show that the October reading is provisional, while Reuters reported the headline annual figure of 6.09%. The headline reading was above the poll forecast of 5.93% and September’s level of 5.54%. The acceleration coincided with inflation remaining above the central bank’s medium-term target of 4%.
Reuters said inflation remained above the central bank’s 4% target for five consecutive months through October 2026. It added that the last time inflation exceeded the 6% upper limit was in October 2024, when it reached 6.2%, according to the previous price index series based on 2012 prices. The comparison puts the current reading above the ceiling for the first time since that earlier breach, according to the series cited by Reuters. This means the price trajectory is moving away from the bank’s target, even though the measure differs from the previous series used in the October 2024 comparison. The official tolerance band remains between 2% and 6%, while the medium-term inflation target is 4%.
The Reserve Bank of India raised the repo rate by 25 basis points to 5.50% in October and shifted its policy stance to gradual tightening, according to its decision. Following the October data, India’s 10-year government bond yield held at 7.25%, Reuters reported. The agency said traders continued to bet on interest-rate increases of about 100 basis points. These indicators bring together an earlier rate hike, a bond yield steady at the stated level, and traders’ expectations for the policy path. Those bets do not represent an announced decision by the bank, while the next decision remains tied to the Monetary Policy Committee meeting scheduled for December.
The Reserve Bank of India projected average inflation of 6.0% in the quarter from October to December 2026 and 5.2% in the current fiscal year, Reuters reported. October’s reading of 6.09% comes at the start of the quarter for which the bank estimates an average of 6.0%. The fiscal-year forecast of 5.2% is also below the quarter’s estimate, according to the figures cited by the agency. India’s Monetary Policy Committee is scheduled to meet on December 2, 3 and 4, 2026, according to the central bank’s calendar. The upcoming meeting places the inflation outlook, October’s reading and the earlier repo-rate decision in the background of the next discussion.