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7 October 2026, sources dated 6 to 7 October 2026 research cutoff
8 verified stories · 6 notes pages · 25 original MCQs
Download Test PDFAnswer Key PDFBanking and RBI
RBI raises repo rate by 25 bps to 5.50% and turns to calibrated tightening
7 October 2026 | Reserve Bank of India, Governor's Statement, 7 October 2026
After its meeting on 5, 6 and 7 October 2026, the Monetary Policy Committee voted unanimously to raise the policy repo rate under the LAF by 25 basis points to 5.50 per cent. The standing deposit facility rate is adjusted to 5.25 per cent, and the marginal standing facility rate and the Bank Rate to 5.75 per cent.
The MPC also changed its stance to 'calibrated tightening', from 'neutral'. Moneycontrol and CNBC-TV18 report that four of six members voted for the stance change, and that this is the first hike since February 2023. The Governor said rate cuts are off the table in the near term and that policy action ahead can only be a rate hike or a pause, depending on the growth-inflation outlook.
Key facts- Repo rate: 5.50% (up 25 bps; vote unanimous)
- SDF: 5.25%; MSF and Bank Rate: 5.75%
- Stance: calibrated tightening (from neutral)
- Governor: rate cuts off the table; next move hike or pause
Exam takeaway: Learn the corridor: SDF is repo minus 25 bps; MSF and Bank Rate are repo plus 25 bps.
Quick revision: Repo 5.50%; SDF 5.25%; MSF and Bank Rate 5.75%; calibrated tightening.
Reserve Bank of India, Governor's Statement, 7 October 2026 original sourceBanking and RBI
RBI raises FY27 GDP forecast to 7.1% and inflation forecast to 5.2%
7 October 2026 | Reserve Bank of India MPC, via Moneycontrol
The RBI raised its FY27 real GDP growth projection to 7.1 per cent from 6.7 per cent, after 7.8 per cent growth in Q1. It expects 7.2 per cent in Q2, 6.9 per cent in Q3 and 6.8 per cent in Q4, and 7.1 per cent in Q1 of FY28.
It raised its FY27 CPI inflation projection to 5.2 per cent from 5.0 per cent, with 4.9 per cent in Q2, 6.0 per cent in Q3 and 5.7 per cent in Q4, and 5.6 per cent in Q1 of FY28. Core inflation for FY27 is seen at 4.4 per cent. The Governor cited a deficient monsoon, El Nino and volatile oil prices. CPI inflation rose to 4.8 per cent in August from 4.5 per cent in July.
Key facts- GDP FY27: 7.1% (from 6.7%)
- CPI FY27: 5.2% (from 5.0%)
- Core inflation FY27: 4.4%
- Pressure points: monsoon, El Nino, oil
Exam takeaway: Growth forecast up, inflation forecast up: that is why the stance moved to tightening.
Quick revision: RBI FY27: GDP 7.1%; CPI 5.2%; core 4.4%.
Reserve Bank of India MPC, via Moneycontrol original sourceBanking and RBI
RBI issues final Directions on Credit Valuation Adjustment
7 October 2026 | Reserve Bank of India press release
The RBI released the Reserve Bank of India (Commercial Banks - Credit Valuation Adjustment Framework) Directions, 2026 on 7 October 2026. Draft Directions were issued on 7 August 2026 and feedback was invited until 28 August 2026.
The draft proposed letting eligible banks choose a simpler approach, making supervisory risk weights for counterparties more sensitive to sector and credit quality, clarifying eligibility and recognition of CVA hedges, and separating systematic and idiosyncratic components in the Basic Approach (BA-CVA). The instructions take effect from 1 April 2027.
Key facts- Instrument: CVA Framework Directions, 2026
- Draft: 7 August 2026; feedback until 28 August 2026
- Applies to: capital charge for CVA risk of commercial banks
- Effective: 1 April 2027
Exam takeaway: CVA is a capital charge for the risk that a derivatives counterparty's credit quality worsens.
Quick revision: CVA Directions final on 7 Oct; effective 1 April 2027.
Reserve Bank of India press release original sourceEconomy and Finance
RBI surveys: rural confidence weakens, household inflation expectation at 10%
7 October 2026 | Reserve Bank of India surveys, via Indian Express and CNBC-TV18
On 7 October 2026 the RBI released results of several forward-looking surveys, including the Urban and Rural Consumer Confidence Surveys and the Inflation Expectations Survey of Households for September 2026. The Rural Consumer Confidence Survey's Current Situation Index fell to 90.6 in September from 91.7 in July, the sixth straight fall from 100.5 in January. Rural households' one-year-ahead inflation expectation rose to 7.9 per cent.
In the household inflation survey, median one-year-ahead expectation rose to 10.0 per cent from 9.4 per cent, and the three-month-ahead figure to 9.9 per cent. CNBC-TV18 notes these are perceptions, not actual inflation. The survey ran from 10 to 20 September across 19 cities with 5,987 respondents.
Key facts- Rural CSI: 90.6 in September 2026 (sixth straight fall)
- Rural one-year-ahead inflation expectation: 7.9%
- Household one-year-ahead expectation: 10.0% (9.4% earlier)
- Survey: 19 cities, 5,987 respondents
Exam takeaway: Perceptions and expectations are survey readings, not the CPI.
Quick revision: RBI surveys: rural CSI 90.6; households expect 10% inflation.
Reserve Bank of India surveys, via Indian Express and CNBC-TV18 original sourceNational and International Affairs
Jaishankar in Ghana: wider cooperation as Ghana seeks BRICS membership
7 October 2026 | External Affairs Minister S. Jaishankar, via India Today
External Affairs Minister S. Jaishankar, in Accra on the first leg of a three-nation Africa tour that also includes Cote d'Ivoire and Ethiopia, said India and Ghana will widen their comprehensive partnership into pharmaceuticals, health, mining, defence, railways and digital technology. The partnership was elevated to comprehensive during PM Modi's visit to Ghana in July 2025.
Two agreements were signed, on agricultural research and training and on biodiversity. Ghana's Foreign Minister Sam Okudzeto Ablakwa said Ghana's Cabinet has approved a decision to seek BRICS membership and will formally apply. Ghana is set to chair the African Union in 2027.
Key facts- Tour: Ghana, Cote d'Ivoire, Ethiopia
- Agreements: agricultural research and training; biodiversity
- Ghana: to formally seek BRICS membership
- Ghana to chair the African Union in 2027
Exam takeaway: The tour has three countries; Ghana is the first leg.
Quick revision: Jaishankar in Ghana: 2 MoUs; Ghana to seek BRICS; AU chair 2027.
External Affairs Minister S. Jaishankar, via India Today original sourceNational and International Affairs
HAL Koraput delivers 2,000th engine; second Shakti line approved
6 to 7 October 2026 | Defence Minister Rajnath Singh, via The Financial Express
On 6 October 2026, HAL's Koraput Division in Odisha delivered its 2,000th aero-engine, and Defence Minister Rajnath Singh announced Rs 218 crore for a second production line for Shakti engines there. The line is to be fully operational by 2028-29 and make up to 100 Shakti engines a year for helicopters such as the Dhruv ALH and Prachand LCH.
Singh said Koraput has also overhauled more than 9,000 engines, delivered 63 AL-31FP engines for the Su-30MKI, and that HAL is raising annual AL-31FP capacity from 30 to 50 engines. Shakti engines are currently made at HAL's Bengaluru division.
Key facts- Milestone: 2,000th engine from HAL Koraput
- Investment: Rs 218 crore, second Shakti line
- Capacity: up to 100 Shakti engines a year; operational by 2028-29
- AL-31FP (Su-30MKI): 63 delivered; capacity 30 to 50 a year
Exam takeaway: Shakti powers ALH Dhruv and LCH Prachand; AL-31FP powers the Su-30MKI.
Quick revision: HAL Koraput: 2,000th engine; Rs 218 crore second Shakti line.
Defence Minister Rajnath Singh, via The Financial Express original sourceAppointments, Awards and Important Days
Ajit Lal named interlocutor for Naga talks
7 October 2026 | Ministry of Home Affairs letter, via Hub Network
The Centre formally informed NSCN (IM) General Secretary and chief negotiator Th. Muivah that retired IPS officer Ajit Lal is the new interlocutor for the Indo-Naga political talks. The letter was issued by Union Home Secretary Govind Mohan on behalf of the Ministry of Home Affairs.
It responded to a representation Muivah made to PM Modi on 27 August. The Centre also decided to bring a political team of a Cabinet Minister or a group of Ministers into the negotiation framework, to enable political decisions on long-pending issues.
Key facts- Interlocutor: Ajit Lal, retired IPS officer
- Counterpart: NSCN (IM), Th. Muivah
- Letter by: Home Secretary Govind Mohan
- Addition: political team of Minister(s)
Exam takeaway: An interlocutor negotiates on the Government's behalf; know the group (NSCN-IM) and the leader.
Quick revision: Naga talks: Ajit Lal interlocutor; NSCN-IM; political team added.
Ministry of Home Affairs letter, via Hub Network original sourceAppointments, Awards and Important Days
Nobel Prize in Chemistry 2026: Henri Kagan and Kenso Soai
7 October 2026 | Royal Swedish Academy of Sciences, via NobelPrize.org
The Royal Swedish Academy of Sciences awarded the Nobel Prize in Chemistry 2026 to Henri B. Kagan of France and Kenso Soai of Japan 'for the discovery of non-linear effects and autocatalysis in asymmetric organic synthesis'. The announcement was on 7 October 2026.
Their work explains how homochirality, the fact that life uses only one mirror-image form of molecules such as amino acids, can emerge. Kagan took the first step in 1986. Soai designed a reaction in 1995 and in 2003 showed one in which only one of two mirror images was formed. The discoveries matter for chemists who design reactions to make pharmaceuticals.
Key facts- Laureates: Henri B. Kagan (France), Kenso Soai (Japan)
- Topic: asymmetric synthesis; homochirality
- Kagan: 1986; Soai: reaction shown in 2003
- Use: making single mirror-image pharmaceuticals
Exam takeaway: Awards questions: names, countries, the topic and the announcing body.
Quick revision: Chemistry Nobel 2026: Kagan and Soai; asymmetric synthesis.
Royal Swedish Academy of Sciences, via NobelPrize.org original source