MUMBAI, April 23 (Reuters) – India’s inflation risks have increased, driven by supply-side disruptions including the Iran war and weather-related uncertainties, the RBI (Reserve Bank Of India) said in its monthly economic report released on Thursday.
Here are the details:
- If the West Asia conflict persists and supply chains are not restored early, that may create challenges to the domestic economy
- Strong macro fundamentals should help the economy withstand shocks
- Inflation may have been contained within the tolerance band, but upside risks have increased, driven by supply-side disruptions including weather-related uncertainties
- Possible second-round effects with the supply shock transforming itself into demand shock warrant
- careful and continuous assessment
- India’s foreign exchange reserves remain comfortable, providing cover for goods imports of around 11 months
