India's retail inflation likely accelerated in April as higher cooking gas and fuel prices pushed up household costs, while core inflation remained largely stable, according to economists tracked by Bloomberg.
The median estimate of 37 economists surveyed by Bloomberg pegged April consumer price inflation at 3.78%, compared with 3.4% in March. Most economists expected inflation to remain below the Reserve Bank of India's 4% medium-term target, although some warned that energy prices and weather risks could add pressure in the coming months.
Thirty-four economists estimated April CPI inflation between 3.4% and 3.6%, while four economists projected inflation in the 4%-4.2% range. The highest estimate stood at 4.2%, while the lowest forecast was 3.5%.
The expected rise in inflation comes after domestic LPG prices increased and global energy markets remained volatile following tensions in West Asia. The RBI, in its April policy review, warned that higher energy prices and weather-related disruptions could raise inflation risks.
"Nirmal Bang expects CPI inflation to inch up to 3.78% in April 2026 from 3.40% in March 2026 mainly on account of higher fuel prices reflecting the full impact of increase in LPG prices," the brokerage said in a note.
The brokerage estimated food and beverage inflation at 4.2% in April, compared with 3.7% in March, while inflation in housing, water, electricity, gas and other fuels was seen rising to 3.2% year-on-year from 1.97%, largely due to higher LPG prices.
Core CPI inflation was seen at 3.34% in April, broadly unchanged from 3.36% in March, indicating that underlying price pressures remained contained.
RBI Outlook
The RBI kept the repo rate unchanged at 5.25% earlier this month and retained its neutral stance, citing rising uncertainty linked to higher energy prices and geopolitical tensions.
The central bank projected CPI inflation for FY27 at 4.6%, with risks tilted to the upside due to elevated energy prices and the possibility of El Niño conditions affecting the monsoon.
"High frequency indicators suggest that growth remains resilient while CPI inflation is gradually inching up," Nirmal Bang said. "We expect CPI inflation to average around 4.3% in FY27, although the possibility of El Niño conditions and a poor monsoon pose upside risks."
The brokerage said it expects the RBI to keep interest rates unchanged through FY27 while focusing on liquidity measures.
Nirmal Bang also projected wholesale price inflation at 5.34% in April, up from 3.9% in March, driven by higher commodity prices across metals, chemicals, textiles and crude-linked products.
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