Reserve Bank of India (RBI) released a monthly bulletin on Friday, September 20, stating that food price volatility remains a contingent risk, even though the inflation indicator, the consumer price index (CPI),

India's headline inflation may average 4.5% in the second half of the fiscal year, aided by weaker crude oil prices, although volatility in food prices can pose a challenge, the central bank said in its monthly bulletin on Friday.

The Reserve Bank of India has noted in its September bulletin that a reversal in vegetable price shocks could signal a reduction in food inflation by Q1 of 2024-25. However, the potential for an unfavourable base effect looms over the September inflation numbers.

The CPI inflation inched up marginally to 3.7% in August from 3.5% in July, largely on account of an uptick in food inflation.

India's overall inflation rate is projected to average 4.5 per cent during the second half of this fiscal year, supported by lower crude oil prices, though unstable food prices may pose a challenge, according to the Reserve Bank of India ( RBI ) in its latest monthly bulletin released on Friday.