Retail inflation may settle at 5.7-6.9% in FY23 after fuel duty cuts

Economists expect 40-50 bps hike in repo rate by MPC next month

After hiking the repo rate by 40 basis points (bps) in its off-cycle decision, the Reserve Bank of India (RBI)'s monetary policy committee (MPC) is likely to decide on the exact rate hike on the basis of its inflationary expectations at that point of time.

Retail price inflation touched a near eight-year high of 7.79 per cent in April, the fourth consecutive month when the rate of price rise was above the MPC's six per cent upper tolerance level. On the other hand, wholesale price index (WPI) inflation zoomed to a series high of 15.1 per cent that month, and