Expected RBI rate hike and nonresident foreign-currency deposits could lift Indian banks’ margins

The Economic Times reported on October 1, 2026, that analysts expected India’s central bank to raise its benchmark repo rate by 25 basis points the following week. They said inflows of foreign-currency nonresident bank deposits, known as FCNR(B), had eased liquidity constraints. Analysts predicted a rate hike could boost bank margins as benchmark-linked loans repriced, but warned banks might not find enough higher-yielding loans.