The Reserve Bank of India (RBI) has forecasted India’s inflation rate for 2026-27 at 4.6% based on the Consumer Price Index (CPI). This projection comes as near-term food supply prospects have improved due to a strong Rabi crop, offering some relief amidst escalating global oil prices linked to the Iran conflict.
RBI Governor Sanjaya Malhotra highlighted that higher global energy prices have led to price hikes in specific fuels like premium petrol, LPG, and diesel for industrial use. Conversely, the robust Rabi crop has bolstered near-term food supply prospects, providing a degree of reassurance.
For the fiscal year 2026-27, CPI inflation is estimated to be 4.6%, with the first quarter at 4.0%, the second at 4.4%, the third at 5.2%, and the fourth at 4.7%, as outlined by the RBI Governor. Despite this, persistent high energy prices due to the West Asia conflict and potential El Niño conditions pose inflation risks.
Malhotra indicated that core inflation, excluding food and fuel prices, is expected to be 4.4% for 2026-27. Excluding precious metals, this rate is even lower, suggesting that underlying inflation pressures will likely remain contained.
