RBI Keeps Inflation Forecast Too Lower At 4%

Mumbai: The Reserve Bank’s Monetary Policy Committee (MPC) has reduced its inflation forecast for 2025-26 to 4 per cent from 4.2 per cent earlier as the “outlook for food inflation has turned decisively positive,” RBI Governor Sanjay Malhotra said on Wednesday.

“Headline inflation moderated during January-February 2025 following a sharp correction in food inflation. The outlook for food inflation has turned decisively positive. The uncertainties regarding Rabi crops have abated considerably and the second advance estimates point to a record wheat production and higher production of key pulses over last year,” the RBI Governor said.

He observed that along with robust Kharif arrivals, this is expected to set the stage for a durable softening of food inflation.

“The sharp decline in inflation expectations in our latest survey for three months and one year ahead would also help anchor inflation expectations, going ahead,” he pointed out.