<h1>Policy repo rate increase to reinforce disinflationary path amid high CPI inflation and slowing growth.</h1> The central bank increased the policy repo rate to reinforce a credible disinflationary strategy in response to persistently high CPI inflation and broad-based inflationary pressures, especially in services and wages, which threaten real incomes and the currency. The rate action aligns with a recommended glide path and baseline projections showing upside inflation risks; further tightening is not anticipated if disinflation follows the baseline, while faster disinflation would permit accommodation. The decision is framed alongside a weakening growth outlook and improving external balances, and accompanied by complementary reforms in market instruments and distressed-asset resolution.