RBI Raises Retail Inflation Forecast For FY25 To 4.8% From 4.5% Earlier

The Reserve Bank of India (RBI) has pegged CPI inflation at 4.8% for FY2025, underlining persistent challenges in balancing inflation and growth. The announcement came during the Monetary Policy Committee’s (MPC) latest meeting, where the repo rate was held steady at 6.5% for the 11th consecutive time. Governor Shaktikanta Das flagged rising risks, including weather disruptions, financial volatility, and geopolitical tensions, as factors that could push inflation higher. "Durable price stability is essential to lay a strong foundation for sustained growth," Das said. Despite resilient growth expectations for the second half of the fiscal year, the RBI acknowledged a recent slowdown, with urban demand showing signs of moderation. Inflation remains a concern, having breached the tolerance band in October. Food inflation, in particular, is expected to persist, with relief likely only in Q4.