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India CPI Hits 4.38% — RBI Holds Rates, Eyes Hike

7/14/2026

31 2 Full Breakdown

Summary

RBI Signals Hike

India’s CPI rose to 4.38% in June 2026, above the RBI’s 4%, with transport up 4.31% and food up 5.32%.
The RBI left its policy rate unchanged in June and signaled a possible 25–50-basis-point back-loaded hike in FY 2026/27.
Monsoon rains cut the deficit to 15% by July 8, but July rainfall is forecast 6% below average, raising food-price risks.

Summary

Treasury Yields Jump

US 10-year Treasury yields jumped 6.3 bps to 4.62% on July 13, 2026, the highest level since May 19, 2026.
CME FedWatch gave a 43.3% chance of a 25-bp Fed hike at the July meeting, versus 56.0% for no change.
Indian Nifty 50 rose 0.02% to 24,211 points while the rupee slipped to 95.62 per dollar.
US equity indexes fell, with the Dow at 52,504 and the Nasdaq 100 at 29,264 points.

History

Historical Context

Paul Volcker’s 1979 appointment led the Fed to raise the federal-funds rate to a 20 % peak in June 1981, slashing inflation from a 14.8 % March 1980 high to below 3 % by 1983. Echoing that “tight-money” legacy, the Reserve Bank of India kept its repo rate steady in June 2026 as CPI hit 4.38 % and U.S. 10-year yields rose to 4.62 %.

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RBI Signals Hike

India’s CPI rose to 4.38% in June 2026, above the RBI’s 4%, with transport up 4.31% and food up 5.32%.
The RBI left its policy rate unchanged in June and signaled a possible 25–50-basis-point back-loaded hike in FY 2026/27.
Monsoon rains cut the deficit to 15% by July 8, but July rainfall is forecast 6% below average, raising food-price risks.

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