Stories
RBI warns of rising food prices and El Nino threat to economy
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News18•08-10-2026, 11:07
RBI warns of rising food prices and El Nino threat to economy
- •The Reserve Bank of India raised India growth projection for the financial year 2026-27 to 7.1 percent despite rising inflation concerns.
- •RBI Governor Sanjay Malhotra warned that inflationary pressures are likely to increase further due to food prices, oil prices, weather conditions, and global growth.
- •CPI inflation rose to 4.8 percent in August driven by food and fuel prices, with significant price increases observed in sugar and onions.
- •Strong El Nino conditions and a weak southwest monsoon could affect the Rabi season and exert supply-side pressures on inflation in the short term.
Key Questions Answered
The Reserve Bank of India has raised India's real GDP growth projection for the financial year 2026-27 to 7.1 percent, which is 40 basis points higher than the previous estimate.
The RBI has warned that inflationary pressures are likely to increase further due to rising food prices, oil prices, adverse weather conditions, and global growth factors.
A weak southwest monsoon and strong El Nino conditions could affect the upcoming Rabi season, potentially leading to a decline in rural demand and increased risks for the agricultural sector.
