The Reserve Bank of India (RBI) has projected retail inflation for the 2025-26 financial year at 4.2%, a decrease from its earlier estimate of 4.8% for 2024-25, as it unveiled the last bi-monthly monetary policy review of the fiscal year.

RBI Governor Sanjay Malhotra shared the inflation projections, stating that food inflation would soften considerably due to favourable conditions, including good kharif crop production, lower vegetable prices, and positive prospects for the rabi crop. He further highlighted that core inflation is expected to rise but will remain relatively moderate during the coming months.