RBI Governor Predicts Inflation Relief Amid Strong Monsoon and Easing Global Food Prices

RBI Governor Shaktikanta Das projects moderation in inflation starting July due to improved monsoon and easing global food prices. He outlines a positive economic growth forecast with real GDP growth of 7.2% for FY 2024-25 while noting mixed signals in the inflation landscape.

RBI Governor Shaktikanta Das announced that inflation is expected to moderate starting from July, largely owing to the improved performance of the monsoon and a drop in global food prices, which began showing signs of easing in July. 'Global food prices showed signs of easing after an increase since March 2024,' said Das.

He noted that a stable southwest monsoon and healthy Kharif sowing progress are expected to provide some relief to food inflation. Buffer stocks of cereals continue to stay above normative levels. The RBI has updated its CPI inflation projections for the fiscal year 2024-25, anticipating a decline through the quarters.

Das pointed out that headline inflation eased to 5.1% in June 2024, driven by higher-than-expected food inflation. Fuel prices remained in deflation for the tenth consecutive month, while core inflation hit a historic low in May and June. Real GDP growth for FY 2024-25 is projected at 7.2%, with balanced risks.

(With inputs from agencies.)