Live Updates > Live Update Details
2026-05-25 20:02:26
[Barclays: RBI May Keep Rates Unchanged in June, But Energy Inflation Risks Could Force Rate Hike] (1) Barclays economists expect the Reserve Bank of India (RBI) to keep interest rates unchanged at its June policy meeting. While the central bank may raise its inflation forecasts and lower its economic growth forecasts, it is likely to ignore the current supply-side inflationary pressures. (2) However, the ongoing conflict in the Middle East has kept energy prices high for an extended period, and price pressures could become more persistent, threatening Barclays' baseline forecast that the RBI will keep interest rates unchanged for the remainder of 2026. (3) The bank adds that the spillover effects of rising energy prices on transportation and other raw material costs could eventually force the central bank to raise interest rates. While economic growth is an important consideration, the risk of an inflationary shock is currently higher than the risk of a growth shock.
