EM central banks tighten again: RBI to 5.50%, Uganda to 12%

RBI moves to calibrated tightening

Minutes released on October 21 show the Reserve Bank of India's Monetary Policy Committee voted unanimously to raise the policy repo rate by 25 basis points to 5.50% at its October 5-7 meeting, and to change the policy stance to "calibrated tightening." with CPI inflation projected at 5.2% and real GDP growth of 7.1% for 2026-27, and core inflation projected at 4.4%. The rate corridor moved as well: the standing deposit facility rate was adjusted to 5.25% and the marginal standing facility rate to 5.75%. m:…3350

The vote was not quite as clean as the headline suggests. Dr. Nagesh Kumar and Prof. Ram Singh were of the view that the stance be retained at neutral — a visible internal divide over how aggressive the turn should be. The next meeting is scheduled for December 2 to 4, which is now the date to watch for whether calibrated tightening means another hike or a pause. m:…3350

Uganda's 225-point shock

Uganda moved harder and faster. The Bank of Uganda raised the Central Bank Rate from 9.75% to 12.0% in October 2026 — a 225-basis-point increase — after a special MPC meeting convened because of significantly increased inflation risks. m:…0944

The rate hike was the second leg of a two-part squeeze. The bank had already raised the Cash Reserve Requirement from 11.0% to 13.5%, effective September 24. Headline inflation rose to 4.6% in September from 4.1% in August, core inflation reached 3.7%, and the bank projects core inflation of 5.5% to 6.0% over the next 12 months. The Ugandan shilling has weakened on higher global oil and shipping costs and reduced foreign-currency inflows, and the bank lowered its FY2026/27 growth forecast to 6.0-6.5%. The BoU says it remains ready to take additional measures if needed to preserve price and financial stability. m:…0944

The holdouts: Georgia warns, Israel rests

In Georgia, the National Bank held its monetary policy rate at 8.25% — but the decision read like a hawk's. The NBG revised its 2026 inflation forecast upward to 5.4% and its growth projection to 7.2%, with annual inflation at 5.6% in September, and said it would increase the policy rate moderately if supply shocks lead inflation expectations to trend upward. The next meeting is December 16. m:…1440

Israel was the genuine counterpoint. The Monetary Committee kept the rate unchanged at 3.25% on October 21 with inflation at 1.6% in September, and lifted its GDP forecast to 5.6% for 2026 and 7.5% for 2027. A hold with low reported inflation is the one decision in the set that reads as comfort rather than caution. m:…1609

What this means for rates desks

My read on the common thread, not any central bank's stated reason: the week's moves share a shape — several of these inflation prints sit against a backdrop of energy and shipping costs and geopolitical uncertainty, and the tightening is happening even where growth forecasts stay strong. India hiked while projecting 7.1% growth; Uganda moved the most aggressively; Georgia holds with a hawkish bias. What the statements have in common is vigilance about inflation expectations, not a cooling boom. m:…3350 m:…0944 m:…1440

For rates desks, the December calendar is the next catalyst: India meets December 2-4 and Georgia on December 16. The spread to watch is the divergence between Israel's low-inflation hold and Georgia's hawkish hold — two committees that did the same thing for opposite reasons. m:…1440 m:…3350