Rising August 2026 CPI at 4.82%—driven by food and energy prices and exceeding the RBI’s 4% target for a third straight month—has shifted trader focus toward potential tightening ahead of the December MPC meeting. Recent Reuters polls show most economists now anticipate a 25-basis-point October hike to 5.50%, with a slim majority expecting a follow-on move by year-end that would lift the repo rate to 5.75%, reflecting broadening price pressures and rupee weakness. Strong GDP growth near 6.7% for FY27 provides some policy space, yet risks of consumption slowdown and incoming September-November CPI prints create substantial uncertainty. Market-implied odds remain evenly split across hike, hold, and cut scenarios, underscoring the data-dependent nature of the December decision and the potential for the October meeting to clarify the near-term path.