How market participants read RBI’s order of priority has a bearing on how well monetary policy works
RBI lowered its inflation projection for 2026-27 marginally. Even so, its forecast implies inflation above 5% for three successive quarters (5.9% in the third quarter of 2026-27, 5.5% in the fourth and 5.3% in the first quarter of 2027-28). It also raised its 2026-27 growth forecast from 6.6% to 6.7%, with the governor noting at the post-policy conference that 7% was “not inconceivable.”
