RBI Forecasts Moderate Rise in Core Inflation Amid Rate Cut Decision

The Reserve Bank of India Governor signaled a controlled increase in core inflation while maintaining an overall optimistic outlook. This assessment comes as the central bank projects overall inflation to ease to 4.2% in FY26, down from 4.8% in FY25. Despite expectations of a moderate uptick in core inflation, the RBI remains confident about the inflation trajectory, supported by easing food prices and favorable agricultural output. This balanced outlook contributed to the RBI's historic decision to cut the repo rate by 25 basis points to 6.25%, its first reduction in nearly five years.

Source: Reserve Bank of India