RBI Governor Shaktikant das
RBI govenror

RBI governor signals confidence in Inflation target, Leaves forecast unchanged at 4.5%

Reserve Bank of India (RBI), has maintained its inflation forecast for the current fiscal year at 4.5%, indicating that the inflation target is within reach. This comes amidst concerns over a hot summer ahead, rising crude oil prices, and ongoing supply chain disruptions due to the Red Sea crisis.

RBI Governor and MPC Chair Shaktikanta Das compared the current scenario to two years ago when inflation had peaked at 7.8% in April 2022, describing it as the “elephant in the room.” Now, he expressed that the “elephant has gone out for a walk and appears to be returning to the forest.”

Das emphasized the need for the RBI to ensure that this “elephant” stays in the forest, using a new analogy compared to his previous reference to keeping an ‘Arjuna’s eye’ on the situation. However, he cautioned against lowering their guard and stressed the importance of continuing efforts to align inflation durably and sustainably to the target of 4%. “Our goal is within reach, but we must remain vigilant,” he stated.

The RBI’s updated inflation projections for the four quarters of this fiscal year are 4.9% for Q1, 3.8% for Q2, 4.6% for Q3, and 4.5% for Q4. These figures are slightly lower than the February policy projections, which were 5%, 4%, 4.6%, and 4.7% respectively, assuming a normal monsoon.


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