The research flags a gap between the RBI’s policy communication and its Monetary Policy Committee discussions. Governor Sanjay Malhotra’s recent remarks have stressed patience and incoming data, while the minutes suggest greater concern about inflation. On SBI Research’s tone measure, with the Governor’s statement set at 1, the minutes rose from 1.76 in June to 1.82 in August 2026.

Rainfall is a key concern. The report puts the national shortfall at 13%, with Punjab, Bihar, Andhra Pradesh and Karnataka among the states facing worries over crop production. Skymet has reduced its monsoon outlook and estimated a 70% drought probability. SBI Research expects consumer inflation could exceed 6% during October and November.

Overseas developments could also complicate the RBI’s decision. AI-related spending is supporting the US economy, potentially delaying Federal Reserve rate cuts. Costlier crude and conflicts abroad are adding pressure to import costs. Even so, SBI Research treats an October increase as a close call rather than a settled outcome.

The report also highlights rural weakness: workdays under the VB-G RAM G employment scheme fell 60% across July and August 2026. It questions how tighter monetary conditions would sit alongside government spending intended to support poorer rural households.