RBI Forecasts Inflation to Align with Target in FY26
In the backdrop of easing crude oil prices and global trade uncertainties, RBI Governor Sanjay Malhotra stated that India’s inflation is expected to align well with the target during FY26. Speaking during the Monetary Policy Committee (MPC) meeting held from April 7–9, Malhotra highlighted that disinflationary forces are currently outweighing the inflationary risks, allowing room for monetary easing to support economic growth.
The Reserve Bank of India (RBI) released the minutes of the April 2025 MPC meeting, where it was revealed that the repo rate was cut by 25 basis points to 6%, and the stance was shifted from ‘neutral’ to ‘accommodative’. This policy decision, alongside the RBI’s positive inflation forecast, comes amid global trade tensions and a slowdown in commodity prices.
Summary/Static | Details |
Why in the news? | RBI Forecasts Inflation to Align with Target in FY26 |
CPI Inflation Target | 4% ± 2% |
Current CPI (March 2025) | 3.3% |
Repo Rate (April 2025) | 6% |
Policy Stance | Changed from ‘neutral’ to ‘accommodative’ |
Inflation Outlook FY26 | Expected to align with target |
Key Factors | Easing Inflation Falling crude prices, weak global demand |
Major Concern | US tariff impact on exports & growth |
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