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The Reserve Bank of India (RBI) on Friday projected the CPI inflation at 5.1 per cent for the financial year 2026-27, said Governor Sanjay Malhotra. It had kept the CPI inflation forecast at 4.6 per cent in the previous policy in April.
However, the inflation outlook has become more challenging due to a sharp rise in global crude oil prices. The Indian crude basket averaged around $110 per barrel during April-May 2026, significantly higher than earlier assumptions. The RBI governor said the gradual pass-through of elevated oil prices to domestic fuel prices, along with rising costs of commercial LPG, industrial raw materials, chemicals, metals, rubber and plastic products, could push inflation higher in the coming months.
The central bank expects inflation to rise steadily through the year, with quarterly projections of 4.2 per cent in Q1, 5.1 per cent in Q2, 5.9 per cent in Q3 and 5.4 per cent in Q4. The RBI also flagged risks from global supply-chain disruptions, commodity price shocks, an uneven southwest monsoon and potential El Niño conditions. However, adequate foodgrain stocks and healthy reservoir levels are expected to provide some support against food inflation risks.
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Haris is Deputy News Editor (Business) at news18.com. He writes on various issues related to personal finance, markets, economy and companies. Having over a decade of experience in financial journalis…Read More
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