RBI trims 2026-27 growth to 6.6% raises inflation to 5.1%
The Reserve Bank of India just updated its outlook for the economy in 2026-27, and weather is a big reason why.
With concerns about a weak monsoon and El Nino, RBI trimmed its growth forecast to 6.6% (down from 6.9%) and bumped up inflation expectations to 5.1%.
Governor Sanjay Malhotra flagged that patchy rains could drive up food prices and shake up the agriculture sector.
Monsoon risk threatens rural incomes
Less rain doesn't just mean fewer crops: it can hit rural incomes, spending, and even job opportunities.
Food inflation is already creeping up, even though overall inflation stayed under 4% in March and April.
The good news? Malhotra says there are buffers like strong food grain stocks, plus government moves toward climate-friendly farming to help soften any shocks.
RBI will be watching this year's monsoon closely before making any more big decisions.