The Monetary Policy Committee of the Reserve Bank of India began its three-day meeting yesterday. The RBI will reveal their decisions on June 5, made by RBI Governor Sanjay Malhotra. According to experts, due to global uncertainties, the central bank is unlikely to alter the interest rates for now. The RBI Governor will release the results of the policy tomorrow.

This year's review takes place amid continuing geopolitical conflicts in West Asia. The rising prices of crude oil and natural gas make it difficult for policymakers to predict the economic future. Most economists agree that interest rates would remain unchanged. However, given the present global situation, the RBI statement will be more cautious than ever.

According to HSBC's Pranjul Bhandari, rates will remain stable in the near term, but tightening is possible later. The market is anticipating two rate cuts starting in the fourth quarter of 2026. Bhandari said that the RBI's revised economic projections will be closely monitored, particularly the average crude oil price forecast. Emkay Global Financial Services also forecasts a status quo on interest rates. The brokerage firm said the softening of Brent crude prices has provided some relief to the RBI.

A CareAge Ratings report suggests that a poor monsoon and rising retail fuel prices have led to higher inflation. Wholesale inflation may impact retail inflation faster than expected. Currently, inflation is rising due to supply-side factors, not demand. If the baseline oil price forecast increases, inflation could rise from 4.6 percent to around 5 percent.

CareAge Ratings has projected GDP growth of 6.7 percent for the 2026-27 fiscal year. This estimate is based on an average crude oil price of $90 per barrel. If the conflict in West Asia escalates and oil reaches $110 per barrel, growth could fall to 6 percent. SBI Research projects growth at 6.6 percent for fiscal year 2026-27 and 7.5 percent for fiscal year 2025-26.