RBI Monetary Policy Committee Revises Upward FY26 GDP Growth Estimate
The Reserve Bank of India's Monetary Policy Committee (MPC) has announced a slight upward revision in its Gross Domestic Product growth forecast for the fiscal year 2025-26. In its February policy outcome, the committee raised the projection to 7.4%, a marginal increase from the previous estimate of 7.3%.
Key Economic Indicators and Policy Stance
The decision reflects the MPC's assessment of improving economic conditions and resilient domestic demand. The committee maintained its policy stance, focusing on aligning inflation with the target while supporting growth. This revision comes amid global economic uncertainties and domestic challenges, underscoring confidence in India's economic trajectory.
The MPC highlighted several factors contributing to the revised forecast:
- Robust performance in key sectors such as manufacturing and services.
- Continued strength in private consumption and investment activities.
- Favorable monsoon conditions supporting agricultural output.
- Government initiatives and structural reforms boosting economic momentum.
Implications for Inflation and Monetary Policy
While raising the GDP forecast, the MPC remains vigilant on inflation risks. The committee emphasized the need to monitor price pressures, particularly from food and fuel sectors, to ensure stability. The policy outcome balances growth support with inflation control, aiming for sustainable economic expansion.
Analysts view this revision as a positive signal for India's economic resilience, though they caution about external headwinds and domestic inflationary trends that could impact future projections.
