RBI Inflation 2026–27: Sanjay Malhotra & Co peg FY27 inflation projection at 4.6% as war risks cloud outlook

The Monetary Policy Committee (MPC) of the Reserve Bank of India on Wednesday set the inflation forecast for FY27. CPI inflation is projected to be 4.6% for the new fiscal year; Quarterly estimates are for a decrease to 4.0% in the first quarter, 4.4% in the second quarter, 5.2% in the third quarter and 4.7% in the fourth quarter. Core inflation is estimated to be 4.4%. The central bank stated that this is the first time such a detailed breakdown has been presented, reflecting demand from some stakeholders.

In contrast, the MPC’s February round had projected overall inflation to be 4% for Q1 and 4.2% for Q2 of FY2027.

Also Read: RBI MPC Repo Rate: Sanjay Malhotra & Co keeps interest rates steady at 5.25% as war shocks adversely affect outlook
Additionally, the RBI left its benchmark repo rate unchanged at 5.25% in its first policy decision since the Iran war, as it balanced support for economic growth against the pressure of a sharply weakening rupee.

Real GDP growth for the previous year was estimated at 7.6%. The central bank kept its FY26 growth forecast unchanged at 7.6%, but expects a slower pace of 6.9% in FY27, with quarterly growth slowing to 6.8% in the first quarter and 6.7% in both the second and third quarters due to risks from the Iran war, higher oil prices and broader geopolitical tensions.