RBI Keeps Interest Rates Unchanged
The Reserve Bank of India (RBI) has kept the repo rate unchanged at 5.25% amid global economic uncertainty. The central bank has reduced its FY2026-27 GDP growth forecast from 6.9% to 6.6% and raised its inflation projection to 5.1% due to rising crude oil prices and geopolitical tensions. Wholesale Inflation Jumps
India’s wholesale inflation (WPI) surged to 9.68% in May 2026, mainly because of higher fuel and energy prices linked to tensions in the Middle East. Fuel and power prices rose sharply, increasing concerns about future price pressures across industries. Rupee and Bond Market Get Relief
Indian financial markets received support after reports of easing tensions between the U.S. and Iran. Falling crude oil prices could strengthen the rupee and reduce inflationary pressure. Foreign investors have also increased purchases of Indian government bonds.Government Focus on Growth
The Union Budget 2026 continues to emphasize infrastructure spending, manufacturing, MSME support, and fiscal discipline. The government expects these measures to help sustain economic growth despite global challenges.
