The RBI’s Monetary Policy Committee kept the repo rate unchanged, citing subdued inflation trends, easing core price pressures, and the need to assess evolving economic conditions
After staying below the 4 per cent target for 16 months, inflation rose to 4.4 per cent in June. The increase was largely driven by food and fuel prices
The RBI expects inflation to rise in coming quarters, with projections indicating levels above 5 per cent for parts of 2026-27. This could challenge price stability goals
With inflation likely to move higher, the real policy rate could weaken. The RBI may need to consider rate adjustments if price pressures persist
Measures to attract foreign inflows have helped stabilise the rupee, with significant capital mobilisation supporting external sector resilience amid global uncertainties
West Asia tensions, energy prices, US interest rates, and global capital flows will influence India’s inflation trajectory and determine the RBI’s future policy decisions