New Delhi: On Thursday, the Reserve Bank of India (RBI) revised its inflation forecast for the financial year 2023-24, declining the same by 10 basis points to 5.1 per cent.

RBI in its Monetary Policy Committee (MPC) lowered its inflation forecast from 5.2 per cent to 5.1 per cent as RBI Governor Shaktikanta Das shared positive response on the results that were being shown by the influential Central Bank’s monetary policies.

“The MPC will continue to remain vigilant on the evolving inflation and growth outlook. It will take further monetary actions promptly and appropriately as required to keep inflation expectations firmly anchored and bring down inflation to the target,” Das said.

New inflation rates set by the RBI’s MPC 

For the first quarter (April-June) for fiscal 2023-24, the inflation rate is to be at 4.6 per cent, 5.2 per cent for the second quarter (July-Sept), 5.4 per cent for the third quarter (Oct-Dec) and 5.2 per cent for the fourth quarter (Jan-March).

It should be noted that in the previous MPC meeting held in April 2023, the RBI anticipated inflation rate for the first quarter to be 5.1 per cent, 5.4 per cent in the second quarter, 5.4 per cent in the third quarter and at 5.2 per cent in the fourth quarter.

Around March-April of the financial year 2023, Consumer Price Inflation (CPI) cooled off a bit and moved into the tolerance band, reducing from 6.7 per cent in the financial year 2022-23.

However, as per Das, headline inflation is still above the target and is expected to be there according to the RBI projection for year 2023-24. He also added that inflation is likely to be at 4 per cent for the year 2023-24.

The RBI governor also showed his concerns over geopolitical tensions, uncertainties during the time of monsoon and international commodity prices, especially sugar, rice and crude oil, and other problems related to global financial markets present upside risks to inflation.

“A durable disinflation in the core component would be critical for a sustained alignment of the headline inflation with the target,” Das said.