RBI governor noted that inflationary pressures are building up

RBI governor Sanjay Malhotra noted in last monetary policy meeting that amidst the turbulent global backdrop, the Indian economy has shown remarkable resilience. Growth for the full year 2026-27 is now projected at 7.1 per cent, 40 bps higher than the projection of 6.7 per cent in August. Inflationary pressures are, however, building up. Headline CPI is projected to touch the upper tolerance band in Q3 and remain significantly above 5 per cent in the next two quarters. After voting for a 25-bps hike in the policy rate, he opined that the duration and extent of the rate hiking cycle would be contingent on the actual growth-inflation developments and outlook, especially that of underlying inflation, the broadening of price pressures, second round effects of the supply shock, and the impact of demand impulses

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