RBI's FY27 Outlook: Crude Prices at $85, Rupee Weakens to 94/USD

The Reserve Bank of India's Monetary Policy report forecasts crude oil at $85 per barrel and the rupee at 94 against the dollar by FY27. These projections come amid a historical decline of the rupee and rising global oil prices influenced by geopolitical tensions and OPEC+ supply adjustments.

The Reserve Bank of India (RBI) has revised its forecasts for crude oil prices and the Indian rupee for the upcoming fiscal years, according to the recent bi-annual Monetary Policy report.

The RBI projects an average crude oil price of USD 85 per barrel for FY27, an increase from USD 70 per barrel in the second half of FY26. Additionally, the rupee is expected to slide to 94 against the dollar in FY27, compared to 88 in H2FY26.

These changes come in the wake of global market fluctuations and geopolitical tensions. The domestic currency has already seen its steepest decline in 14 years, primarily due to foreign fund outflows, high global oil prices, and a strengthening USD, prompting steady pressure on the rupee throughout FY26.

(With inputs from agencies.)