inflation forecast

India's retail inflation remains largely unaffected by West Asian conflict, with SBI retaining its FY27 forecast at 4.5%. While imported inflation eased slightly, rising food prices, particularly tomatoes, are a key driver. Future trends hinge on energy price pass-through and summer crop progress, with the RBI flagging upside risks.

Governor Malhotra Says Flexible Inflation Targeting May Not Be Enough Amid Crisis

Gold prices are expected to remain steady this week, influenced by US-Iran talks and upcoming US economic data. Silver, however, may continue to outperform due to geopolitical tensions and high crude oil prices. Investors await signals on the Federal Reserve's next policy move amidst shifting statements from Washington and Tehran.

Fuel prices in India saw their first hike in four years, with petrol and diesel increasing by Rs 3. This move aims to alleviate significant daily losses incurred by oil marketing companies, estimated at Rs 1,000 crore. While consumer inflation may see a slight uptick, the fiscal impact is considered minimal, with annual consumption expected to recover.

India's transportation fuel demand growth is set for a sharp slowdown in late 2026. Higher prices, government conservation efforts, and a weakening rupee are impacting mobility. Analysts have significantly cut growth forecasts, with petrol demand facing the steepest decline due to reduced commuting and discretionary travel.

The Indian rupee hit a new low against the US dollar, pressured by rising oil prices and external debt. Analysts link the decline to the US-Iran conflict, which has boosted crude oil costs and strained India's economy. While the RBI and government are intervening, markets anticipate potential interest rate hikes to stabilize the currency and manage inflation.

Gold price prediction today: Gold and silver prices are rallying in the domestic market due to the sudden hike in import duties. In the coming days they are expected to align closer to the international prices, says Vedika Narvekar, Research Analyst - Commodities & Currencies, Anand Rathi Shares and Stock Brokers.

Oil prices dipped Wednesday after a three-day rally, with traders watching the Iran conflict's ceasefire and the Trump-Xi summit. Despite a slight fall, crude remains above $100 a barrel due to ongoing supply fears. Analysts predict elevated prices for months, impacting global inflation and potentially delaying US interest rate cuts.

Asian Development Bank Chief Economist Albert Park forecasts elevated crude oil prices, averaging $96 per barrel in 2026 and $80 in 2027, due to prolonged Middle East tensions. This outlook suggests a 0.6% reduction in India's GDP growth for FY27, pushing inflation to 6.9% amid reliance on imported oil and gas.

A viral Instagram post by Udayan Adhye estimates raising a child in an Indian metro city could cost Rs 6.75 crore. The figure, driven by escalating education, lifestyle, and inflation costs, has sparked widespread debate. Adhye's breakdown highlights soaring school and college fees, alongside expenses like coaching, vacations, and healthcare, prompting discussions on modern parenting's financial realities.

Despite global economic headwinds from Middle East turmoil, India's economy is projected for stable growth through FY26 and FY27, with SBI forecasting around 7.5% for FY26. Resilient domestic demand, strong credit expansion, and broad-based improvements in high-frequency indicators support this optimistic outlook, though external vulnerabilities like oil prices and currency movements remain key concerns.

China's exports surged 14.1% in April, significantly exceeding expectations and bolstering the nation's economy despite global uncertainties. This strong performance precedes a crucial meeting between US and Chinese leaders, where trade tensions and other disputes are expected to be discussed. Analysts anticipate continued export-driven growth for China this year.