Uneven monsoons, El Nino may lift food inflation, report says
In short
Uneven monsoons and a possible El Nino could push up food inflation in FY27, a Nuvama Institutional Equities report said. Economic Times reported that this could keep the Reserve Bank of India open to another interest rate hike.
The report matters because food prices affect overall inflation and can influence RBI policy decisions.
What the reporting says
Uneven monsoons and the possibility of El Nino conditions could raise food inflation in FY27, according to a report by Nuvama Institutional Equities cited by Economic Times. The report said these weather risks could keep the Reserve Bank of India open to another interest rate hike, even as overall price pressures are expected to ease gradually. The warning links farm-weather volatility to the inflation outlook and policy stance.
Why it matters
Uneven monsoons and possible El Nino conditions were flagged in a Nuvama Institutional Equities report cited by Economic Times as upside risks to food inflation in FY27. The report said these weather conditions could leave the Reserve Bank of India open to another interest rate hike, even with expectations that broader price pressures may gradually moderate. The impact is centered on inflation-sensitive households, borrowers and policy watchers.