(ET)
Given the ongoing geopolitical developments, primarily owing to Russia’s invasion of Ukraine, the RBI Governor on Friday revised the inflation outlook upwards.Governor Das announced that the inflation for the current fiscal is now projected at 5.7%, up from 4.5% forecast in the February meeting. Q1FY23 inflation is now seen at 6.3%, Q2 at 5%, Q3 at 5.4% and Q4 at 5.1%.Retail inflation has remained above the central bank’s 6% upper tolerance band for the last two months.”Sharp pump prices may push inflation; edible oil prices to remain at an elevated level in the near future,” Das said.
Global research firm HSBC in a note authored by Pranjul Bhandari had said that greater-than-expected inflation would be worrying when led by a further widening of the wedge between small and large firms, strong pent-up services demand, oil prices settling well above US$100 per barrel, and a full pass-through to the private sector & higher farm input costs, wheat and edible oil prices stoking food inflation.
