Fiscal Outlook: RBI Raises FY27 GDP Growth to 7.1% and Inflation to 5.2%

The latest RBI projections, as cited in the SBI Research note, show the central bank upgrading its growth outlook for fiscal year 2027. Gross domestic product growth is now forecast at 7.1 percent, up 40 basis points from the previous estimate, while retail inflation is expected to average 5.20 percent, a 20‑basis‑point increase.

Analysts believe that if the inflation trajectory eases as anticipated, the peak policy rate could settle around 6.0 percent by November 2026, when inflation is projected to hit roughly 6.8 percent. The speed and scale of any further rate hikes will depend on how quickly price pressures subside and the durability of the slowdown.