Consumer Price Index (CPI) inflation is projected at 2 per cent for FY26. For 2026-27, CPI inflation is expected at 3.9 per cent in Q1 and 4 per cent in Q2. Under the flexible inflation targeting regime, RBI is mandated to keep inflation at 4 per cent with a band of +/- 2 per cent. Bhattacharya said the GDP growth in the first half of FY26 had been unexpectedly high, led by the effects of lower than forecast CPI and occasional negative WPI inflation. Earlier this month, the six-member MPC lowered the repo rate by 25 basis points (bps) to 5.25 per cent to support growth.

Source: Indian Express December 26, 2025 12:06 UTC