CPI Inflation projection.
Further, the Reserve Bank of India projected the CPI Inflation for FY26 at 2.6 per cent, down from 3.1 per cent in the August Projection.
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The central bank projected CPI inflation for Q2 and Q3 of FY26 at 1.8 per cent and for Q4 at 4 per cent. Further, the CPI inflation for Q1 FY26 is projected at 4.5.
The RBI stated that benign inflation conditions during 2025-26 have been primarily driven by a sharp decline in food inflation from its peak in October 2024. Inflation within the fuel group moved in a narrow range of 2.4-2.7 per cent during June-August, the central bank said.
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Earlier in August, the Reserve Bank had projected CPI inflation for Q2 FY26 at 2.1 per cent and Q3 FY26 at 3.1 per cent, and Q4 FY26 at 4.4 per cent
GDP Growth
The Reserve Bank upgraded the real-time GDP growth for FY26 to 6.8 per cent. Earlier in August, the RBI projected the GDP growth at 6.5 per cent for FY26.
Furthermore, the RBI projected real-time GDP growth for Q2 FY26 at 7 per cent, for Q3 FY26 at 6.4 per cent, for Q4 FY26 at 6.2 per cent, and for Q1 FY27 at 6.4 per cent.
The Reserve Bank said that ongoing tariff and trade policy uncertainties will impact external demand for goods and services. However, RBI added, the implementation of several growth-inducing structural reforms, including streamlining of GST, is expected to offset some of the adverse effects of the external headwinds.
RBI unveils key measures to strengthen banking system
The Reserve Bank stated that the ECL Framework (Expected Credit Loss Framework) and Basel III norms will be implemented as of April 1, 2027. Furthermore, the central bank stated that drafts on standardised credit risk, prudential regulations, and risk-based insurance premiums will be issued soon.
The Reserve Bank proposed removing regulatory restrictions on overlap in the businesses undertaken by a bank and its group entities. Further, it proposed to expand the scope of capital market lending by banks and to remove the regulatory ceiling on lending on listed debt securities