RBI Retains Growth and Inflation Projections Amid Balanced Macroeconomic Conditions

The Reserve Bank of India (RBI) has retained its growth and inflation projections at 7.2% and 4.5% respectively for the current fiscal year. Improved agricultural activity and buoyant services support the economic outlook. However, geopolitical tensions and financial market volatility pose risks. Vigilance on inflation remains crucial.

The Reserve Bank of India (RBI) kept its growth and inflation projections steady at 7.2% and 4.5% respectively for the ongoing fiscal year, reflecting expectations of a normal monsoon.

In its latest bi-monthly monetary policy review, RBI Governor Shaktikanta Das stated that improved agricultural activity is likely to boost rural consumption, while a sustained services sector would support urban demand. He highlighted that robust balance sheets and investment thrust are expected to drive fixed investment activity.

Despite these positive signs, Das noted that geopolitical tensions and financial market volatility pose downside risks. For 2024-25, real GDP growth is projected to remain at 7.2%. Inflations projections are balanced, with a slight relief expected from food prices as the monsoon progresses.

(With inputs from agencies.)